Sudan makes concession on talks with South

by on July 27, 2012 10:49 pm BST

A Sudanese oil ministry official said
Khartoum had lowered the amount it wanted to charge to transport Southern crude
through its territory, in a bid to settle one of a long list of arguments
between the rivals, Reuters reported.

South Sudan split away from Sudan last year
as part of a peace deal that ended decades of civil war.

But the two countries went their separate
ways without agreeing on the details of dividing their oil industries, the
position of their shared border and the ownership of disputed territories.
Their armies have clashed a number of times since the secession.

South Sudan said during African
Union-mediated talks on Monday it had increased the amount it was prepared to
pay to transport its crude through two major pipelines to Port Sudan on the Red

The offer from the landlocked South was for
$9.10 per barrel for one pipeline and $7.26 per barrel for the other pipeline.

“We have come with a counter-proposal
which we think is a step forward … We are now offering $32.20 (for each
pipeline)” the undersecretary of Sudan’s oil ministry, Awad Abdelfatah,
told Reuters on Friday at the talks venue in the Ethiopian capital Addis Ababa.

Sudan had earlier demanded $36 a barrel for
each pipeline plus back payments.

Both sides base their offers on conflicting
and sometimes changing assumptions, making comparison to previous offers

Abdelfatah said South Sudan’s latest offer
would leave Khartoum with less than a dollar for both pipelines as the bulk of
the sum would go to the firms operating the facilities.

A senior South Sudanese official in Addis
Ababa dismissed Sudan’s new offer on Friday as “nothing new”.

Oil provides for about 98% of South Sudan’s
income. Juba is trying to develop infrastructure and institutions devastated by
decades of war.

South Sudan
shut down 350,000 barrels per day of oil production in January after the north
started seizing southern oil to make up for what it called unpaid export fees.

The latest round of talks, mediated by former
South African President Thabo Mbeki, have also broken down several times over
where to set up a demilitarised border buffer zone, seen as a first step to
ending hostilities.

Sudan has said it wants to make border
security a priority at the talks. It accuses Juba of supporting rebels in two
southern border states, a claim denied by South Sudan.

Abdelfatah said a security deal would have to
precede any agreement on resumption of South Sudan’s oil exports.

“We have stated clearly that there will
be no agreement on the transportation of petroleum or any other agreement
unless we reach an agreement on security issues,” he said.

“The petroleum facilities are huge, big
facilities that can easily be targeted and the border is a huge border so we
need solid peace before we can start any petroleum operation.”