South Sudan to cut oil output to 100,000 bpd at weekend
Fri Jul 19, 2013 7:54am EDT
* South starts cuts after Khartoum decides to block its oil exports
* Recent output has been 200,000 bpd, cuts already begun this week
* Tension surrounds rebels operating across the shared border
By Andrew Green
JUBA, July 19 (Reuters) - South Sudan will slash its oil output to 100,000
barrels a day over the weekend as it moves toward a full shutdown, its
foreign ministry said, after Sudan decided to block its exports in a row
over rebels operating across their shared border.
Sudan, the sole conduit for South Sudan's oil exports, said a month ago it
would close two cross-border oil pipelines within two months and insisted
oil production be shut by Aug. 7 unless South Sudan gave up support for the
rebels.
South Sudan's government in Juba denies providing such support.
Oil and foreign grants are the main source for South Sudan's budget.
Diplomats worry that turning off oil wells will undermine stability in the
African country, which seceded from Sudan in 2011.
They point to recent looting of aid agencies by soldiers as a sign that Juba
is struggling to pay salaries.
The shutdown is also grave news for Sudan, which has been struggling with
turmoil since losing most oil reserves with South Sudan's secession. Oil
fees from Juba are essential to bring down soaring inflation, which stokes
dissent.
The dispute threatens to disrupt oil sales of
<
http://www.reuters.com/places/china> China National Petroleum Corp,
Malaysia's Petronas and Indian firm ONGC Videsh which operate the fields in
the South.
The neighbouring countries, which fought one of Africa's longest civil wars
ended in 2005, came close to war in April 2012 when tensions over pipeline
fees and disputed territory escalated.
Landlocked South Sudan, which depends on a Sudanese Red Sea port to export
its crude, said on Thursday it had started shutting output to 160,000 bpd,
down from 200,000 bpd.
"It should go down to 100,000 over the weekend, and then next week it will
continue to go down from there," Mawien Makol Arik, a foreign ministry
spokesman in Juba, said on Friday.
Sudan has not commented on Juba's decision to reduce its oil flows. Reuters
has been unable to reach the oil and foreign ministry in Khartoum since
Thursday.
South Sudan had only resumed oil production in April, after turning off
wells pumping around 300,000 bpd in January 2012 when both sides failed to
agree on pipeline fees.
Sudan has allowed the sale of oil that had already reached its territory
before notifying Juba of the pipeline closure.
DEJA VU
Sudan and South Sudan had agreed several times since last year to resume oil
flows and put an end to hostilities plaguing them since their messy divorce.
But mutual mistrust runs deep.
Khartoum accuses Juba of supporting the "Sudanese Revolutionary Front"
(SRF), a rebel alliance, which complains of neglect at the hands of the
wealthy Khartoum elites. The SRF in April staged an attack on central Sudan,
embarrassing the army on whose support President Omar Hassan al-Bashir
depends.
South Sudan in turn accuses Sudan of backing rebels in its eastern Jonglei
state, where fighting is making it impossible to realise government plans to
search for oil with the help of France's Total and U.S. Exxon Mobil.
Human Rights Watch said South Sudan's army was fuelling dissent in Jonglei
by killing and abusing civilians during a state disarmament plan to end
tribal violence.
"Witnesses reported a number of killings of civilians, including women and
children, by soldiers in December, January, March, April, and May in or
around the town of Pibor," HRW said in a report. There has been also "verbal
and physical abuse and looting of civilian property by soldiers" especially
in mid-May.
South Sudan's army spokesman Philip Aguer denied the army had killed any
unarmed civilians. "Categorically, the army has been fighting only the
insurgents," he told Reuters.
The fighting has cut off aid to 100,000 people in the vast state, the United
Nations said on Wednesday.
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Received on Fri Jul 19 2013 - 23:28:08 EDT