Sudan: Obama urges ceasefire in oil-rich south

By Eric Watkins
US President Barack Obama urged the Khartoum-based government of northern Sudan to end its military operations against southern opponents in the oil-rich border state of South Kordofan, a scene of intense fighting in recent weeks.

"The government of Sudan must prevent a further escalation of this crisis by ceasing its military actions immediately, including aerial bombardments, forced displacements and campaigns of intimidation," said Obama, who renewed the US commitment to the peace process underway in the region.

For several weeks, Khartoum’s military forces have been fighting southern-aligned armed groups in Southern Kordofan, the north's main oil state along the border with South Sudan, stepping up tensions ahead of the south’s independence on July 9.

At stake in the conflict is control, or at least a share, of the country’s oil export revenues, a point stressed by the north’s Finance Minister Ali Mahmud.

"Sudan will lose 36.5% of its income from July 9 because this is the percentage of oil revenue that the government gets from the oil produced in the south," said Mahmud.

Khartoum receives around 50% of the oil revenues generated by the south, which produces 75% of Sudan's 470,000 b/d crude output.

According to the US Energy Information Administration, Sudan’s oil exports represent over 90% of the country’s total export revenues, but further development is “hindered by conflicts and sanctions.”

That view was underlined last week when Khartoum threatened to stop the southern government from using its petroleum infrastructure, which includes the 1600-km Greater Nile Oil Pipeline, several refineries, and the export terminal at Suakin on the Red Sea.

"We have sent a letter to south Sudan, to inform them that they cannot use the pipelines or the refinery or the port after July 9 unless we reach a deal about the price of renting this infrastructure," Mahmud added.

So far, southern officials have remained silent about plans mooted a year ago for the contraction of a new pipeline from the south through neighboring Kenya to a new export facility being planned for the island of Lamu.

At the time, analyst BMI suggested that southern officials were concerned not to raise the ire of the northern regime.

“Any move on the part of a future southern Sudan to assert the independence of its oil industry would likely be seen as highly provocative in Khartoum and could lead to violence” (OGJ Online, July 16, 2010).

Khartoum is desperate to offset the looming fall in its income even as it struggles to cope with soaring inflation, a weakening currency and foreign debt of $38 billion which, together with US sanctions, has choked its sources of external financing.

Washington has offered Khartoum a number of incentives in exchange for an orderly transition to independence for the south: gradual steps toward full normalization of diplomatic ties, the removal of Sudan from the US terrorism blacklist, and an international agreement on debt relief.

President Obama reminded Khartoum of the stakes: "I want to speak directly to Sudanese leaders: you must know that if you fulfill your obligations and choose peace, the United States will take the steps we have pledged toward normal relations.”

But the president also warned that “those who flout their international obligations will face more pressure and isolation and they will be held accountable for their actions."

Sudan's President Omar al-Bashir last week said his army had matters “under control” in South Kordofan, as clashes continued between his government’s troops and members of the former southern rebel army, the SPLA.

"The situation in South Kordofan is under the control of the Sudanese Armed Forces which are now clearing the state of the remaining rebels," Bashir said.

Bashir’s top aide Nafie Ali Nafie said the country’s ruling National Congress Party had given a "free hand" to the armed forces to bring the situation in South Kordofan under control.

Sudan analyst John Ashworth said that the north’s military actions in the states of Abyei, South Kordofan and Blue Nile amounted to “a deliberate attempt by Khartoum” to seize control of the oil-rich regions ahead of the July 9 deadline.

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