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South Sudanese oil export resumes from Sudan

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(Globalpost/GlobalPost)

Shipments of South Sudanese oil from Sudan have resumed after resolution of a year-long fee dispute, a senior petroleum ministry official said Thursday, but uncertainty hangs over the oil flows after President Omar al-Bashir ordered them stopped.

"The first shipment already left" from the Port Sudan terminal, Awad Elkarim Mohammed, undersecretary at the oil ministry, told AFP.

The load departed around June 21 but Mohammed said he was not sure who bought it.

"It is exported from South Sudan's oil field," he said.

South Sudan halted its crude production early last year after accusing Khartoum of theft in a row over export fees.

China was the biggest buyer of the oil.

The South split from Sudan two years ago following a referendum vote for independence under a peace deal that ended a 22-year civil war.

The new country separated with roughly 75 percent of the 470,000 barrels per day of crude which had been produced by Sudan. Refineries and export pipelines stayed under Khartoum's jurisdiction.

Independence left key issues unresolved, including how much the South should pay for shipping its oil through Sudan's export infrastructure.

Rising tensions led to months of intermittent border clashes, until Juba and Khartoum in March finally agreed on detailed timetables to resume the oil flows and implement eight other key pacts to normalise relations.

The agreements had been signed in September but did not take effect for months because of Sudan's concerns that the South was backing rebels.

Juba denies supporting cross-border insurgents and has in turn accused Khartoum of backing rebels on its territory.

As tensions eased, South Sudan resumed pumping oil in April and the crude began a slow journey of about 1,500 kilometres (930 miles) through pipelines to the Sudanese export terminal, where stock built in preparation for loading onto ships.

Then on June 8 Sudan's Bashir abruptly ordered shut the pipeline carrying the South's crude, after warning Juba over backing rebels in the north.

Analysts say his order came after rebel attacks which humiliated the authorities.

Sudan's Information Minister Ahmed Bilal Osman said Khartoum was freezing all nine agreements, including the oil deal which is worth billions of dollars each to the impoverished economies of Sudan and South Sudan.

But in a conciliatory gesture, Osman also said some South Sudanese oil had already reached the export terminal and the South was free to sell it -- as long as it paid the fees owed to Khartoum.

Mohammed, the oil ministry official, said on Thursday that "there are some preparations" for shutting the pipeline and "the decision of the president is still valid".

A shutdown cannot be done immediately without damaging the infrastructure, giving diplomatic efforts to resolve the impasse time to work.

An independent expert earlier said 45 days would be required to carefully close the pipeline.

African Union officials have said their top negotiator Thabo Mbeki has made "urgent proposals" to both sides for resolving the disagreement.

The proposal would have the AU and another regional body, the Intergovernmental Authority on Development in Eastern Africa (IGAD), investigate the allegations of rebel support, an analyst told AFP.

Barnaba Marial Benjamin, spokesman for the South's government in Juba, confirmed that 600,000 barrels of Dar blend petroleum left Port Sudan around June 21 for China and the export process is smooth, for the moment.

"Every three or four days the ships will be going," Benjamin said.

But he said the threat from Khartoum to shut the export pipeline "is still there".

"That is the decision of Sudan. It is not South Sudan. As long as we have adequate time, we will save our infrastructure," he said.

Benjamin expressed hope that a visit on Sunday by Vice President Riek Machar to Khartoum will restore dialogue.

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http://www.globalpost.com/dispatch/news/afp/130627/south-sudanese-oil-export-resumes-sudan-0