Bread protest in Khartoum and future pipeline negotiations between South Sudan and Sudan
By Kurthii Manyuat, Beijing, China
Friday, January 11, 2019 (PW) —- Although South Sudan attained it independent in 2011, it was in large part of a political independent, the economic had arguably failed to make it out during the process due to the absolute necessity of using Sudanese pipeline facility to transit south Sudan’s only export commodity–the oil.
Great Nile pipeline, despite being used as a weapon for extracting fund by Sudan, it is extremely significant for the government of South Sudan to transport its oil to the international market and keep the economy alive as long as nothing is done to reduce 98% oil dependency. It had been a precious opportunity for Sudan to discover the vulnerability of the south.
Our partners in the oil pipeline deal have enjoyed huge leverage for a very long time and we have endured all the costs to the extent of earning $5dollar per barrel of oil in 2014, 2015. the worse could be coming since the smoldering bread protest which others called it a ‘revolution’ in our northern neighborhood may in one way or another increase appetite for that regime to seek fund voraciously.
Like it or not, south Sudan is a standard target for eliciting fund. Sudan is now terrified by the current ongoing protests which never occurred in the history of the ruling party. The mutual oil dependent agreement that includes (transit fees, transition arrangement fund, and other packages) negotiated and signed in 2016, though barely seen by many, will get expired in 2019 and there is going to be a need for both countries to renegotiate and renew the deal.
It is with this that many fear Sudan may harden its position on the negotiation table and demand more money that would be enough to settle local goals such as reviving the economy to silence public outcry as well as buying ammunition to zip up oppositions.
I am one of those skeptical group who didn’t buy into the idea that South Sudan and Sudan are warm and normal given the birth of R-CRISS Khartoum’s peace deal. The current model of relations between two countries could confuse many but it is a Matter of survival and for South to stay in peace while it’s an opportunity for north to earn money on the oil sector.
I heard some government officials anticipating this year finalization of economic compensation which south pay to Sudan. Wether this financial burden is put to end this year or years to come, it would not mean the end of paying Sudan unknown ransom will, it will still extract more concession on it advantageous position to ask for more and more.
Luke party, a researcher in the Danish Institute for international studies (DIIS) in his research work stated that “south Sudan will be at a difficult bargaining position against Sudan as pipeline deal would seek renewal in 2019”. Of course the protest in Khartoum was originally ignited by bread price but chance of spilling on to negotiations table with South Sudan are high to the peak.
What should be done to secure positions on future pipeline fees negotiations with Sudan?
Historically, oil and gas transit pipelines are often associated with conflicts. One of the prerequisites for oil and gas transit pipeline construction is to carefully study the relations of countries involved along the pipeline, in the context of past and present. Should there be a glaring enmity, the project deserves disqualification right away. This is simply because traditional foes don’t match good partnership since business negotiations turn personal at zero hours.
Iraq is one of the countries that had experiences of transit pipeline long before the Second World War in1934. Its transit pipeline stretched across Middle East passed Syria, Lebanon, Turkey, and Iran. And though there were so much of wrangling and conflicts involving pipeline transit fees by the time, common ground and mutual understanding were found at the end as Arab nations (something contrary to our case with Sudan).
However, in 1948, when Israel emerged at their midst, the pipeline section passing through the territory of Israel was shut down and spur line was built abruptly leading to Saudi Arabia to avoid contact with Israel.
What determined South Sudanese to secede did not end with attainment of independence either. The length and width of our rivalry issues with Sudan government are too large to be erased in one day. The oil theft and Panthou crises would attest to the claim.
The 2012 oil theft and subsequent shutdown of oil flow prompted South Sudan government to seek alternative path. And numerous pipeline proposals emerged mainly to Ethiopia, Kenya, and Uganda to avoid Sudan’s monopoly on its pipeline but none of those had substantiated.
All the proposals are yet in MOU (memorandum of understanding) documents without feasibility studies. However, the civil war at home and oil price fluctuations on the international market are two quintessential factors to blame for why government has done nothing on proposed pipeline alternative.
Luck of funding for the mega projects such as cross border pipeline is not just our own challenge but the whole of East Africa region. Uganda and Kenya have recently joined the club of oil industry. Some east Africa countries like Uganda and Tanzania have already joined hands to start constructing their oil and gas pipeline to port Tanga. South Sudan need to prepare joining partnerships with east Africa countries for regional pipeline construction.
Thus in the meantime, the current government and the one which will be formed in the next six month under R-CRISS peace deal must in one hand ensure the provision of proper security so that oil exploration activities could carry on safely and boost investors’ confidence to exploit resources sufficiently and effectively while on the other hand, we need to conduct a feasibility study on proposed pipeline routes. It would be a good counteract against Sudan.
The author, Kurthii Manyuat, is a student of petroleum engineering China university of petroleum Beijing, China. He can be reached via his email: Kurmanyuat@gmail.com
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