6 August 2012

Sudan: U.S. Welcomes Pact By Sudan, South Sudan to Share Oil Revenues

Photo: Issac Billy/UN
South Sudanese citizens show support for their government's decision to shut down all national oil production, effectively cutting off the flow of crude oil from South Sudan to Sudan (file photo).

Washington — The United States welcomes an agreement between Sudan and South Sudan to share the revenues of oil pumped in South Sudan and transported through pipelines and ports in Sudan.

"This agreement opens the door to a future of greater prosperity for the people of both countries," President Obama said in a statement August 4. "The leaders of Sudan and South Sudan deserve congratulations for reaching agreement and finding compromise on such an important issue."

Secretary of State Hillary Rodham Clinton met with South Sudan President Salva Kiir in Juba, South Sudan, on August 3 a few hours before the oil revenue-sharing deal was struck.

Speaking to reporters in Juba, she said she emphasized to Kiir the value of reaching an "interim agreement" with Sudan. "Getting it resolved is very much in South Sudan's interest, because a percentage of something is better than a percentage of nothing," she said. She added that an interim agreement would allow South Sudan the freedom to explore future options for selling its oil to foreign markets.

When South Sudan seceded from Sudan in July 2011, it took about three-fourths of the oil resources that previously were controlled by the government in Khartoum. The pipelines and ports needed to transport the oil in South Sudan to foreign markets are in Sudan's territory. In January, South Sudan stopped pumping oil because of a dispute with Sudan over transit fees. The shutdown caused South Sudan to lose 98 percent of the foreign exchange that financed its government.

The secretary was in Nairobi, Kenya, when the announcement came that the agreement had been reached. "The future of South Sudan is now brighter," she said.

While in Juba, she said the U.S. commitment to the new African country is "enduring and absolute in terms of assistance and aid." She announced that the United States was contributing an additional $15 million to help the United Nations deal with the refugee crisis affecting people in Sudan and South Sudan. To date, the United States has contributed more than $50 million to alleviate the refugee crisis.

"The oil shutdown and the refugee crisis both point to an inescapable fact: While South Sudan and Sudan have become separate states, their fortunes and their futures remain inextricably linked," she said.

She appealed to both governments to show compromise as they work to resolve remaining issues, such as security, citizenship, and border demarcation.

Clinton said coming U.S. assistance to South Sudan will be focused on helping the new country build democratic institutions, improve transparency and increase its agricultural productivity. "We believe that South Sudan's soil is fertile enough for the country to be not only one of Africa's but one of the world's breadbaskets. Yet most of your food still has to be imported. So we have launched a number of agricultural initiatives to help change that, including providing loans, seeds, and other technology to South Sudan's farmers," she said.

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