Sudan, South Sudan strike oil deal

Published Aug 04, 2012 09:43am

People wait to get fuel for their vehicles at a petrol station in Khartoum June 21, 2012. —Reuters Photo

ADDIS ABABA: Sudan and South Sudan have hammered out a deal on how to share their oil wealth, one of a series of disputes that brought the rivals to the brink of all-out war earlier this year.

“The parties have agreed on all of the financial arrangements regarding oil, so that’s done,” African Union mediator Thabo Mbeki said early Saturday after talks in the Ethiopian capital.

The two countries had faced an August 2 deadline set by the United Nations to resolve their differences on oil and borders, and Mbeki said they would meet next month to try to find a compromise on the disputed region of Abyei.

Mbeki said a timetable would now be drawn up for the resumption of oil production and exports, which are vital to the economies of both deeply impoverished countries.

“What will remain, given that there is an agreement, is to then discuss the next steps as to when the oil companies should be asked to prepare for resumption of production and export,” he said.

The AU has been mediating long-running talks to try to resolve a series of disputes that have flared since South Sudan became independent in July 2011 following a 2005 peace deal that ended one of Africa’s longest civil wars.

Landlocked South Sudan took with it three-quarters of the oil held by the previously united nation, but the pipelines and processing facilities remained in Sudan.

And the two sides were unable to agree on how much Juba should pay to export its crude through a northern pipeline and port, leading the South to shut down production in January after Khartoum began seizing the oil in lieu of payment.

Oil generates about 98 per cent of South Sudan’s revenue and the move crippled the economies of both countries.

Despite the oil agreement, South Sudan’s chief negotiator Pagan Amum accused Khartoum of violating a peace plan drawn up by the African Union in April urging both sides to reach a comprehensive deal on all outstanding issues.

“The government of Sudan continues to violate the road map and continues to bomb South Sudan,” Amum told reporters.

“The (AU) peace and security council in its road map and resolution decided that they would impose sanctions on Sudan if they fail to comply, Sudan has failed to comply,” he said.

Mbeki’s announcement came hours after US Secretary of State Hillary Clinton called on the two Sudans to strike an urgent compromise, saying they “remain inextricably linked”.

“It is urgent that both sides, north and south, follow through and reach timely agreements on all outstanding issues, including oil revenue sharing, security, citizenship and border demarcation,” Clinton said after meeting South Sudan’s President Salva Kiir in Juba.

Clinton, on a tour of Africa, spent around three hours on Friday in the steamy heat of Juba -- a rapidly growing city largely made up of simple tin-roof huts strung out alongside the White Nile river.

“There must always come a point where we look forward and recognise the need to stop fighting over past wrongs so we can build toward a new future,” she said.

“It’s time... to dig wells instead of graves,” she added, quoting a South Sudanese bishop. “Time to reach an agreement that allows both countries to prosper.”

Mbeki said Sudan’s President Omar al-Bashir and Kiir would meet next month to find an agreement on Abyei, whose status was the most sensitive issue left unresolved before South Sudan’s independence

“There’s an agreement between the parties that the matter of the final status of Abyei will be addressed at the next summit meeting of the presidents,” he said.

Ahead of the agreement announced by Mbeki, Sudan had lowered its demand for oil fees from South Sudan. Sudan had been seeking up to $36 a barrel in fees, but in a position paper released on Thursday said it was proposing $22.20 a barrel, compared with $7.61 offered by South Sudan.

Sudan accuses South Sudan of supporting insurgents on its territory, a charge that analysts believe despite denials by Juba, which in turn accuses Khartoum of backing rebels south of the border.

The two countries fought along their undemarcated frontier in March and April, sparking fears of wider war and leading to a UN Security Council resolution that ordered a ceasefire.

Mbeki said an agreement had also been reached between Sudan, the United Nations, the AU and the Arab League to allow for humanitarian access in the conflict-wracked Blue Nile and South Kordofan states.

Prolonged clashes between Sudanese forces and rebel groups in the two disputed territories have left thousands in a “desperate state” and in need of emergency aid, according to the United Nations.

Comments (0) (Closed)