Last ditch agreement on hold
Under pressure from the UN, Sudan and South Sudan have embarked on steps towards resolving their oil stalemate, writes Asmaa El-Husseini
Due to unprecedented international pressure, Khartoum and Juba have reached an agreement that may allow oil production to restart, giving a much-needed boost to the flailing economies of both countries -- but much depends on whether negotiators on both sides would be able to iron out thorny security issues.
Kamal Obeid, a key figure in the ruling National Congress Party (NCP) in Sudan, says that the agreement in question remains "on hold", pending further talks on security matters. He was referring to Khartoum's charges that South Sudan was helping the rebels of South Kordofan, the Blue Nile and Darfur. The latter have recently united in what is called the Sudanese Revolutionary Front or the Kauda Alliance -- Kauda being a town in South Kordofan.
Khartoum is said to have opened talks with one member group of the said alliance; namely, the SPLM-North. Presidential Assistant Nafie Ali Nafie, however, doesn't seem to think that these talks would be fruitful.
When asked about the talks with the rebels, Nafie told a gathering of youth leaders that it was unlikely for Khartoum to make a deal with the SPLM-North.
According to people who were present in this particular gathering, the youth leaders criticised the government policies and called for immediate decisions to revive the economy and consolidate security.
With both governments facing strong opposition at home, an agreement on oil may be their only hope of survival. News of their agreement has been warmly received by foreign diplomats, and some have called it a breakthrough in relations.
But Khartoum and Juba, one has to keep in mind, only reached this agreement after the UN threatened them, through Resolution 2046, with sanctions unless they reach a deal.
The agreement is to last for three years. Oil is at the core of the conflict which flared up between the two countries since the south seceded in July 2011.
Since the secession, oil production, which used to run at 0.5 million barrels a day, dropped by 75 per cent. Khartoum consequently lost more than 85 per cent of its export revenues, while Juba saw 98 per cent of its entire income evaporate. Since January 2012, oil production in the south has ground to a complete halt.
Economic meltdown on both sides of the border offers a major motivation for a deal. But the agreement will be viewed with suspicion by either side.
In Khartoum, critics will say that Juba may use the three-year deal to build its own pipelines through other countries, and may also use the cash to fund rebels in the north.
In Juba, critics object to the $3 billion compensation, which may be used to boost Khartoum's military power.
Oil experts say that technical difficulties may impede the production of oil for six more months or more, even if both sides abide by the agreement. According to these expects, some oil wells have been improperly sealed, and the pipelines have been filled with water to prevent mechanical damage.
Still, African mediators who facilitated the deal hope that the two capitals will resolve their outstanding security differences by 22 September, the deadline the UN set for the two sides to reach an agreement.