Sudan Signs Oil Agreement
Sudan and South Sudan have come to an agreement over disputed oil payments, preventing a possible war as tensions rise.
South Sudan – the world’s newest country – separated from Sudan in 2011 keeping 75% of the oil production along the border region. This greatly hurt relations with the Sudan, who claimed the oil-producing regions as their own. These tensions caused limited military crashes along the borders early in 2012 raising fears of an all out war. So this oil agreement will help relations between the neighbors.
The agree pays Sudan royalties of $9 per barrel transported through Sudan to their Mediterranean ports, as well as $3 billion in lost Sudanese revenues. South Sudan oil production has been shut down since January. South Sudan has no infrastructure gaining them access to ports other than Sudan, however construction has started on a new pipeline through Kenya.
Former South African president and African Union mediator for the talks, Thabo Mbeki, said “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.”
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