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Sudan and South Sudan in oil deal

A Southern Sudanese soldier standing next to the infrastructure of an field processing facility in Unity State (file picture)Disagreements over oil have crippled the economies of South Sudan and Sudan

Sudan and South Sudan have struck a deal on an oil payments dispute that brought the two countries to the brink of war earlier this year.

They will also discuss a timetable for resuming oil exports through the north, said mediator Thabo Mbeki.

Landlocked South Sudan shut down oil production in January after failing to agree a deal on oil transit fees with its northern neighbour.

The dispute has severely impacted the economies of both countries.

A United Nations deadline for the neighbouring countries to resolve their differences – including the oil payments dispute and disagreements over borders – expired on Thursday.

Economic woes

Former South African president and African Union mediator Thabo Mbeki said all outstanding issues had been resolved, but gave no further details on the agreement.

“The parties have agreed on all of the financial arrangements regarding oil,” he told reporters in the Ethiopian capital Addis Ababa, where the African Union Peace and Security Council was meeting.

“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.”

Neither country has made any comment on the deal.

When South Sudan seceded from the north in 2011, it took three-quarters of Sudan’s oil with it.

The dispute over how much South Sudan should pay Khartoum to transport oil through its territory has led to huge economic problems in both countries.

South Sudan has suspended all oil production, accusing its neighbour of stealing its exports, while austerity measures have sparked weeks of protests in Khartoum.

The two countries came close to all-out war in April, when South Sudanese troops briefly occupied the disputed oil-rich border area of Heglig.

President Mbeki’s announcement comes hours after US Secretary of State Hillary Clinton urged the two Sudans to strike a deal on a visit to Juba.

“It is urgent that both sides, north and south, follow through and reach timely agreements on all outstanding issues, including oil revenue sharing, security, citizenship and border demarcation,” she said.

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