OilVoice - International Acceptance of New Borders for Sudanese Oil Town

International Acceptance of New Borders for Sudanese Oil Town

Friday, July 24, 2009

China has welcomed both northern and southern Sudan's acceptance on an international arbitration over the disputed oil-rich region of Abyei.

The ruling not only reduced the size of Abyei – considered a historical bridge between northern and southern Sudan – but also gave most of the oil areas to Sudan’s northern-based national government, based in Khartoum.

Chinese Foreign Ministry spokesman, Qin Gang’s comments came in the wake of a ruling issued on Wednesday by the Hague-based Permanent Court of Arbitration (PCA).

The trio of the United States, the European Union and the United Nations have also hailed the ruling as a success.

However, in what at first glimpse appears a resounding victory for the north, the deal may perhaps be better for the south than the ruling may divulge. The ruling actually leaves the south with at least one oil rich field and control over the town of Abyei itself. Independent experts – including the International Crisis Group – have said that the oil fields falling in the north are nearly depleted, and that the south may have more oil within its borders after all.

Oil aside the agreement marks a significant step in the peace process. The initial Abyei region boundaries were drawn-up under the 2005 peace deal that ended Sudan’s 21-year-long civil war. Under this initial agreement a significant proportion of oil resources were based in the South.

Mutrif Siddiq, undersecretary of foreign affairs and a senior member of the Khartoum government, commented: “This decision is final and binding for both parties.”

The non-governmental organisation International Crisis Group estimates the fields produced $529 million worth of oil in 2007, but believes that they are only becoming further depleted by the day. Recent estimates suggest that the Abyei area accounted for as much as a quarter of Sudan’s total oil production as recently as 2003. This figure is now forecast to be as little as 10%.

South Sudan’s officials have on occasion cried foul on the lack of transparency in terms of either oil output or income figures, and believe they are being deprived of their percentage, as agreed upon in the 2005 peace deal with the north.

Under a ceasefire pact signed by both the Sudanese government and the Sudan people’s Liberation’s Movement (SPLM) – a separatist group that has fought for independence for the south – the people of the region are set to have an independence referendum, to be held in 2011.