Friday 27 January 2012

Sudan and South Sudan leaders bid to defuse oil dispute


A Southern Sudanese soldier standing next to the infrastructure of an field processing facility in Unity State (file picture) South Sudan is an oil rich country but still has to use refineries and pipelines in Sudan
The presidents of Sudan and South Sudan are to meet in the Ethiopian capital Addis Ababa to discuss a dispute over transit fees for South Sudan's oil.
Since independence last July, South Sudan has been using Sudan's infrastructure to export its oil.
However, last week South Sudan said it was suspending oil production, accusing Sudan of "stealing" its oil.
Sudan says the south has not been paying transit fees and that it has taken the oil in lieu of payment.
The summit will bring together South Sudanese President Salva Kiir and his Sudanese counterpart - and old enemy - Omar al-Bashir.
'Oil war' A lot is riding on the summit as if South Sudan's threatened shutdown in oil production is completed, it would damage the already struggling economies of both countries, reports the BBC's James Copnall in Khartoum.
Some Sudanese newspapers are already calling the crisis the "oil war", he adds.
African Union mediators have said that Sudan and South Sudan are not far away from returning to actual conflict, he says.
On Wednesday the South Sudanese government announced a deal with Kenya to build an oil pipeline linking its oil fields to Kenya's Lamu port, potentially reducing its dependence on Sudan for exports.

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