Sudan, South Sudan Resume Oil Talks as Malaysia’s Petronas denies South Sudan oil theft claim
10 min readKAMPALA, Uganda—South Sudan and Sudan are set to resume negotiations Tuesday over disputed oil-transit fees as tensions escalate along their common border, officials said Monday.
A delegation from South Sudan, led by the chief negotiator, Pagan Amum, flew to Addis Ababa, the Ethiopian capital, Monday for talks with Sudanese government officials as the two sides seek a common ground on the dispute, Atif Kirr, the spokesman of South Sudan’s ruling Sudan People’s Liberation Movement party, told Dow Jones Newswires.
“The negotiators will look at the new proposals from both sides,” he said, adding that talks are likely to run until the end of the week.
State-run Sudanese Media Center quoted Al-Zubair Ahmed Al-Hassan, a member of Sudan’s negotiating team, as saying that their delegation is considering important strategic arrangements expected to contribute toward finding a solution to the spat.
“The upcoming round of talks is preceded by lengthy study and consultations on the possibility of reaching solutions,” he was quoted as saying. “The Sudanese government delegation is fully prepared to exert maximum possible efforts to settle the outstanding issues between the two parties.”
Unlike previous talks, this round of negotiations is expected to focus only on the oil issue.
The spat over transit fees escalated in January after Sudan confiscated oil worth $815 million belonging to its Southern neighbor. The newly independent nation promptly halted shipments of as much as 350,000 barrels of oil a day through Sudanese pipelines and ports.
Analysts expect little headway during this week’s talks as both sides maintain rigid negotiating positions.
Talks last month broke down after South Sudan accused Sudan of confiscating more oil shipments that had remained in pipelines and storage facilities.
According to Kirr, South Sudan isn’t ready to accept Sudan’s demand of $32 in transit fees per barrel of oil.
Since South Sudan halted oil shipments, a lifeline for both countries; tensions have been mounting, resulting in clashes along the common border.
Last week, South Sudan accused Sudan of bombing its oil fields in Unity state, a charge denied by Sudan. A week earlier, Sudan had accused South Sudanese troops of invading its Jua region along the poorly defined border.
Aid agencies say that both countries continue to amass troops along their common borders, despite the nonaggression pact signed by the two former civil war foes last month.
Malaysia’s state-owned oil-and-gas firm Petroliam Nasional Bhd, one of the largest producers of oil in South Sudan, said Monday that its likely to experience production challenges this year because of the oil-transit spat. The company’s 135,000 barrels a day of oil production has been shut since January because of the dispute.
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Will new talks between Sudan and South Sudan end oil dispute?
In January, South Sudan cut off oil production, accusing its northern neighbor of stealing its oil. Now the African Union is aiming to settle things down.
By Scott Baldauf, Staff writer / March 5, 2012
An oil well oozes crude oil after it was hit by a shrapnel from a bomb dropped by fighter jets at the El Nar oil field in South Sudan’s Unity State, March 3. South Sudan accused Sudan of bombing two oil wells in the north of the new nation and moving troops and weaponry close to an army base near the poorly defined border.
Hereward Holland/REUTERS
Here’s how the Sudan peace plan of 2005 was supposed to work: After 22 years of civil war, South Sudan would try to coexist with the Sudanese government in Khartoum, and if that didn’t work out, they could secede and form their own country. The South would pump oil, the North would pipe it out to Western markets for a fee, and everyone would be happy.
Here’s what happened: South Sudan and Khartoum didn’t get along, South Sudan seceded in July 2011, and the two countries have been fighting, rhetorically and militarily through proxies, ever since.
Now, tensions are bringing the two countries perilously close to war. In the northern states of South Kordofan and Blue Nile, rebels once allied with the South have been waging a guerrilla war against Khartoum, and Khartoum has responded with carpet bombing of civilian areas. Ethnic rivalries in the South Sudan states of Jonglei and Unity have broken out into fighting, and tens of thousands have been displaced. The South reports that northern MiG jet fighters have bombed oil fields this past weekend, and refugee camps in the South. In January, South Sudan accused Khartoum of siphoning off Southern oil for its own refineries, and has shut off oil production, pushing both economies to the brink of collapse.
Peace efforts by former South African President Thabo Mbeki attempted to bring both sides back to the negotiation table in January during the African Union’s summit meeting in Addis Ababa, to no avail. But a fresh round of talks over oil pipeline fees, starting Tuesday in Addis Ababa, give the two sides a chance to pull themselves back from the brink.
Amb. Princeton Lyman, the US government’s special envoy to Sudan, told reporters in a Jan. 25 telephone conference call that the situation between the two Sudans is serious, but that war is not inevitable.
“I don’t think either Sudan or South Sudan wants or intends to go back to full-scale war,” Ambassador Lyman said in the Jan. 25 conference call. “The relationship is bad. So there is a danger that things could get out of control, that incidents could lead to greater conflict. That’s why these issues are so terribly important, not only in and of themselves but to prevent exactly what you’re talking about. But I think both sides recognize that going back to full-scale war would be disastrous.”
In theory, these two countries should be eager to return to the negotiation table out of sheer self-interest. South Sudan ended up receiving about 75 percent of all oil-production after secession, making it a potentially very rich country. This is good news, because South Sudan will need a lot of money to rebuild its country after 22 years of civil war. But South Sudan is a land-locked country, and the only pipelines that can currently take its oil out to foreign markets run through northern Sudan.
Khartoum, for its part, desperately needs transit fees from all that southern oil to help keep its own economy going, and to pay for the enormous government bureaucracy that it has built up to govern what was once the largest country in Africa. Diplomatically, it needs to resolve its conflicts with South Sudan and with its western Darfur region in order to have a hope of restoring relations with the international community. Heavy economic sanctions against Khartoum’s leaders – imposed both for allegations of Sudan’s support for terror groups and also charges of war crimes and genocide in the Darfur dispute – have prevented Sudanese President Omar Al-Bashir from accessing foreign investment.
But sometimes countries don’t do what is in their long-term self-interest. And while the US and the African Union are struggling to prevent a full-scale war, it doesn’t take full-scale war to create a full-scale humanitarian disaster.
Presently, more than half a million civilians in South Kordofan and Blue Nile states are displaced and lacking access to food. The Famine Early Warning System (FEWS-NET) has warned that famine is possible if emergency measures aren’t taken to provide food assistance to the displaced, but Khartoum has denied international aid groups access into South Kordofan and Blue Nile, saying they are internal matters.
Aside from those displaced from borderland conflict zones, there are an additional 700,000 South Sudanese living within northern Sudan, and the International Organization for Migration says it is struggling to help those who want to repatriate down south before Khartoum’s deadline of April 9.
Dividing Sudan into two countries was always going to be difficult. The 2005 Sudan Peace Accords, signed in Naivasha, Kenya, anticipated several potential problems and offered creative solutions. But as the Monitor reported in June 2011, “public consultations” that were intended to give Sudanese citizens a voice about their future in the disputed borderline states of South Kordofan and Blue Nile were never held. Some members of the Sudanese People’s Liberation Movement, allied with the South Sudan government, saw the consultations as a mini-referendum for possible secession. Armed conflict broke out before a vote was taken.
Khartoum, which has just completed talks with Mr. Lyman on a recent visit, says it will continue to study the African Union’s suggested mediation plan. But the ruling party in Khartoum, the National Congress Party, dismissed any diplomatic intervention by the United States.
“We don’t trust them and their positions,” said NPC officer for mobilization Haj Majid Suwar said in press statements on Sunday. The US “promised prior to the signing of Naivasha agreement (the 2005 peace accords) to remove Sudan’s name from terror list and cancelling sanctions on it but has not delivered and repeated the same behavior in Abuja agreement and backed down on its obligations.”
Sudan, South Sudan Resume Oil Talks
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By NICHOLAS BARIYO KAMPALA, Uganda—South Sudan and Sudan are set to resume negotiations Tuesday over disputed oil-transit fees as tensions escalate along their common border, officials said Monday. A delegation from South Sudan, led by the chief …
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Malaysian state-owned oil giant Petronas Monday denied any knowledge of alleged oil theft by the consortium it belongs to which is in the middle of a bitter dispute between Sudan and South Sudan. South Sudan last month expelled the Chinese head of the …
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