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South Sudan petroleum ministry confirms oil-backed loan

requests

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IMF concerned by South Sudan's use of oil-backed loans

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$2.5 billion requested is larger than country's annual

budget

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Ministry says funds 'not for personal or individual

benefit'

NAIROBI, Nov 13 (Reuters) - South Sudan's petroleum

ministry confirmed on Thursday that it had asked for a total of

$2.5 billion in oil-backed loans from two international firms

operating in the country.

The total amount requested is larger than the government's

annual budget, which is less than $2 billion, and the roughly

$2.2 billion the United Nations estimates South Sudan has

received in oil-backed loans since independence in 2011.

The ministry confirmed it had sent two letters requesting

the loans late last month, but in a statement rejected what it

said was defamatory commentary on social media relating to them.

"The requested funds were intended solely for official

government purposes, not for personal or individual benefit," it

said, adding that the requests were preliminary and that no

funds have been transferred.

In an October 27 letter to ONGC Nile Ganga B.V., a local

unit of India's ONGC Videsh, which was published online and

confirmed as genuine by the petroleum ministry, it requested an

advance payment of $1 billion against crude oil entitlements

controlled by the national oil and gas company.

The ministry also confirmed as genuine a letter in which it

requested $1.5 billion under the same conditions from China

National Petroleum Corporation (CNPC) on October 31.

In both cases, the ministry proposed repaying the loan

within 54 months of disbursement of the funds.

ONGC Videsh, CNPC and state-owned Nile Petroleum Corporation

did not immediately respond to emailed requests for comment.

The International Monetary Fund has raised concerns about

the impact of oil-backed loans on South Sudan's public debt.

The U.N. says corruption has been a major driver of repeated

bouts of armed conflict in South Sudan, including a 2013-2018

civil war in which an estimated 400,000 people died.

U.N. investigators also said in September that the

systematic looting of its oil riches by political elites has

fuelled a humanitarian crisis in the impoverished country.

(Writing by Elias Biryabarema; Editing by Aaron Ross and

Alexander Smith)