North, South Sudan agree on oil terms

Feb. 16, 2011 at 6:42 AM
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JUBA, Sudan, Feb. 16 (UPI) -- The government of South Sudan will have to pay its northern counterpart a transit fee for oil exports when independence is gained in July, an official said.

South Sudan becomes the world's newest nation when it formally gains independence in July. Nearly all of the voters in a January referendum voted in favor of the measure, though details concerning oil and border demarcations loom over the issue.

Pagan Amum, the secretary-general of South Sudan's ruling party, said his government in Juba will have to pay Khartoum a transit fee for use of an oil pipeline rather than operate in a revenue-sharing scheme.

"The notion of continuing sharing wealth will not be there," he was quoted by Bloomberg News as saying.

He said Juba might have to offer a grant to its northern neighbor to compensate for oil losses.

South Sudan, which gets the bulk of its revenue from oil, takes control over about 75 percent of all oil production in the country when it gains independence in July. Oil moves via pipeline from the south to Port Sudan on the Red Sea.

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