The old rivals India and China have found a new arena and a third player to complicate their relationship in the oil-rich Sudan. The China National Petroleum Corp (CNPC) plans to invest $1 billion jointly with Sudan, to create the African country's largest oil refinery. The pending deal will see a $300 million investment expand the Khartoum Refinery from 50,000 barrels per day to 90,000. The CNPC has invested more in Sudan than in any other country.

Meanwhile, the Indian firm ONGC Videsh Ltd (OVL, the overseas arm of state exploration firm Oil and Natural Gas Corporation), has bid to acquire two more oil blocks in Sudan. OVL recently acquired a 25 per cent stake in a 280,000 barrels per day producing oil field (the Greater Nile Oil Project in Sudan's Muglad Basin).

The Indians want Block 5A and 5B in the same basin, since Block 5A contains the undeveloped Thar Jath field (with gross proven and probable oil reserves of 149.1 million barrels). Unfortunately for the Indians, the Malaysian firm of Petronas Carigali Overseas has a 68.875 per cent stake. Petronas had exercised its pre-emption right and given the Indians no end of grief, when they wanted to buy the Canadian Talisman Energy's 25 per cent stake in 5A. Only after the Sudanese Government intervened, did the deal go in the Indian company's favor. 

Meanwhile, the Indian government isn't just sitting back on it's hands and watching. A 20-officer delegation from India's National Defense College arrived in Khartoum on the 19th a five day visit. The delegation (which also included officers from Britain, Sultanate of Oman, Nigeria, Benin and United Arab Emirates) will meet senior Sudanese military officers from the Higher Military Academy and attend lectures on the fast growing Sudan-India relations. Who wants to bet the Indian officers are studying "Force Projection". - Adam Geibel