South Sudan expels head of Chinese-Malaysian oil firm

PALOUGE OIL FIELD, South Sudan (Reuters) -

South Sudan has expelled the head of Chinese-Malaysian oil consortium Petrodar, the main oil firm operating in the new African nation, top southern officials said on Tuesday, escalating a row between Juba and Chinese oil firms.

South Sudan has attacked Chinese oil firms and launched an investigation into whether they helped Khartoum seize southern oil being exported through Sudan until Juba shut down its oil output last month.

"The (oil) minister has just expelled the president of Petrodar," said Pagan Amum, South Sudan's top negotiator for talks with Sudan over oil payments.

"I think one of the reasons is lack of cooperation by the President of Petrodar (with the government) and we have dismissed him and expelled him and we are asking the partners to appoint a new president," he told Reuters during a visit to the oil field of Palouge.

Amum said relations with China were good but there were difficulties with some oil companies.

South Sudan has said Chinese oil firms have helped Sudan seize southern oil being exported through a Petrodar pipeline.

Petrodar categorically rejected the accusations on Sunday and said it had followed only southern instructions.

South Sudan's attack on Chinese interests is puzzling Western diplomats because China is the biggest buyer of its oil.

Petrodar pumped 230,000 bpd from Upper Nile state, to which the Palouge field belongs, until the shutdown. It is a consortium of mainly Chinese state firms Sinpoec, Chinese National Petroleum Corp and Malaysia's Petronas. It runs oil fields in South Sudan and also an export pipeline through Sudan.

South Sudan took three-quarters of Sudan's oil production when it became independent in July but needs to export crude through a northern pipeline and a Red Sea port.

Both states have failed to agree on transit fees Juba needs to pay, prompting Khartoum last month to seize at least three southern oil shipments at the Red Sea terminal. South Sudan has responded by shutting down its entire output of 350,000 bpd.

(Reporting by Hereward Holland; writing by Ulf Laessing; editing by Keiron Henderson)