Saturday, January 21, 2012

South Sudan halts oil production in row with Khartoum

Oil production has been halted in South Sudan amid a dispute over sharing revenues with the Khartoum government.

South Sudan gained independence in July 2011 but the two states have not been able to agree on how to divide their oil wealth.

Most of the oil is produced in the south but is exported from Port Sudan in the north.

Sudan has accused the south of not paying transport fees and said it is taking the revenues in lieu of payment.

The two sides are currently holding talks in Ethiopia to try and reach a deal.

China, a major buyer of oil from both countries, has urged them to resolve their differences.

But South Sudan's Information Minister Marial Barnaba Benjamin told the BBC's Focus on Africa programme that the cabinet had decided to turn off the taps.

"We are not benefiting from the oil," he said, accusing Khartoum of stealing it.

South Sudan has to export oil via the north because it has no port or refineries of its own.

Sudan: A country divided
Map showing position of oilfileds in Sudan, source: Drilling info international

Sudan exports billions of dollars of oil per year. Southern states produce more than 80% of it, but receive only 50% of the revenue. The pipelines run north but the two sides have still not agreed how to share the oil wealth in the future.

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