Home | News    Wednesday 16 February 2011

South Sudan rules out sharing oil revenue with North

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February 15, 2011 (JUBA) – The new state of South Sudan that is expected to officially become the world’s newest state in July, has no intention of continuing to split the proceeds from oil revenue, an official in the South’s ruling party said on Tuesday.

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Pagan Amum, Secretary General of the Sudan’s People Liberation Movement (Reuters)

The secretary general of the Sudan People Liberation Movement (SPLM) Pagan Amum told reporters today that the South will only pay a fee for using the pipelines that transport the oil to Port Sudan.

"The notion of sharing wealth will not be there. There is no continuation, whether 50 percent or anything," Amum said according to Reuters.

Most of Sudan’s proven daily output of 500,000 oil barrel is extracted from oilfields in the South whereas the pipelines infrastructure and refineries are based in the North. Both sides need to maintain cooperation on oil after secession to sustain their economies which depend greatly on oil revenues.

"There’s going to be an agreement on the South continuing exporting its oil through the pipeline in Northern Sudan and to Port Sudan, and the South will be paying pipeline fees for transportation," said Amum.

"We may be paying a transit fee because now Northern Sudan is going to be a different independent state from the south," he added.

Amum’s statements run contrary to those made last year by Southern officials in which they suggested that sharing oil revenue will continue even after the South secedes.

“Our concern is the economic viability ... and the unity of the North, which, I think, will make us even see whether we can continue with the same arrangement that we have,” SPLM leading figure Luka Biong told the Financial Times in an interview.

“For the time being, it is true oil can be used for a soft landing and making economic stability and co-operating with the North,” he said. “But in the long run, this one may not be viable.”

“It is in the interest of the south not to see the Northern economy collapsing,” he added.

Even U.S. Secretary of state Hillary Clinton hinted that the North and South should continue the oil-sharing formula put in place by the 2005 Comprehensive Peace Agreement (CPA).

"What happens to the oil revenues?" Clinton said. "And if you’re in the North and all of a sudden you think a line’s going to be drawn and you’re going to lose 80 percent of the oil revenues, you’re not a very enthusiastic participant. What are the deals that can possibly be made that will limit the potential of violence?"

North Sudan is currently in economic crisis that manifests itself in soaring inflation and hard currency shortage, which forced the government to implement unpopular austerity measures such as cutting subsidies on sugar and petroleum products.

While officials in the North said that they have alternatives such as new oil discoveries and gold mining to compensate for lost revenue, analysts are skeptical whether this would constitute an immediate remedy.

(ST)

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  • 16 February 2011 08:56, by Gatwech

    Of course the CPA sharing of 50/50 will not be there.

    But the South will have to continue sharing some reasonable percentage of oil revenue with the North in hiring the oil pipeline, refinaries and Port Sudan for exporting the crude oil.

    Those economic interests involving the oil sector should be used as part of forging good relations with the North.

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    • 16 February 2011 09:09, by Dinka domanited SPLA

      Gatwech this how you mised trieble.no sharing with khartoum
      The fact is, you have fallen lately, Cecily, into a bad habit of thinking for yourself. You should give it up. It is not quite womanly... men don’t like and that is how the trick Riek for unfuctioning government in 1990s.
      change surrender yourself to the winner of the game????????

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      • 17 February 2011 09:05, by Raan

        Mr Gatwech, you re very right, pagan Amum also very right, you know where we brought peace from and benefit of it, and the challenges we had face from such money lover tribes OK, led fulfill the mission.

        I think, the so call Donkey/dinka dominated SPLA, is mentally ill, did he know that 90 percent SPLM/A Dominant are other tribes? please’ if any of you know where he was should tell him to come to Ministry of finance to get some money for such chronic mental illness, let him ask for auditors desk and explain himself.

        I hope Dr riek is Down right there leading the negotiation to meet the time line of a waiting D-day July 9th 2011, God who ever become block/stone shall go to heal for better future of coming Generation.

        jikany are very keen watching the formation coming soon.

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    • 16 February 2011 09:35, by Gatbentiu

      I don’t see the reason why we have to hired pipeline when it is government asset and we were part of that government,I hope its one of the important things that the SPLM can discussed with NCP.In the post referendum arrangement the asset in the central government have to be divide including the debt.So the pipeline is government asset not oil company asset.

      dholbentiu@gmail.com

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      • 16 February 2011 11:33, by Southern_Stocker

        Very Valid input .. well said....

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  • 16 February 2011 08:59, by Aleu

    The New Sudan nation must focusing on the agriculture sector, because this oil is just a none renewal and Officials should not put hope with it. Starting agriculture right now in Southern Sudan.

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    • 16 February 2011 11:04, by Kuer Dau Apai

      Very good Aleu, not only did the SPLM and its people took guns to own just oil but FREEDOM and RIGHTS to the nation!! Oil is one amongst hundreds of important resources.

      Let look on Agriculture and encourage the southerners to get involved in Agriculture

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  • 16 February 2011 08:59, by Tobiin

    The problem is that most countries bordering south Sudan do not have stable government. our oil pipeline wouldn’t go back to the north. but we will find out what suite our deal.
    I also blame those corrupt idiots who are about to destroy the government of south Sudan with their greed.

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  • 16 February 2011 08:59, by Dinka domanited SPLA

    Ahahahahah riek gai kok And mawel madout promised Bashir that south is going to share oil with them now what will happen? they will loose their expensive buildings.

    If you have no will to change it, you have no right to criticize it”shame on them.

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    • 16 February 2011 11:38, by Southern_Stocker

      Most of the southern sudanese leaders are idiot as per say... All their buildings and properties which carry high values are either in the North or abroad... shame on APLM/ and SPLM members who even came later and did the same ....Who to blame... Poor governance and weak judgment... greed is the leader of southerners leaders.... So sad to say that... Im no longer angry

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  • 16 February 2011 09:02, by Anyang

    Right Mr Amum, only agrees to pay for transportation cost, otherwise anything than that is not worthy.

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    • 16 February 2011 17:32, by Ajok Garang

      There is no need again to share the revenue when we the southern sudanese are not long relating with the North ,even 1% will not go to the North and that was the reason we were struggling to be our own country .

      Ajok Garang Ajok

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  • 16 February 2011 09:05, by gais juvan

    Pagan,
    You have said it, and may be it may happen to be true
    But your statements run contrary to those made last year by Southern officials in which they suggested that sharing oil revenue will continue even after the South secedes.
    Don’t you think will thwart the southerner at last,
    Payning the pipe may cost less, but need diplomatic talks with the north. let me hope they will not charge higher then sharing the revenue.
    Surley with time to come we don’t need North Arabs to claim oil of the south.
    North need to distant from oil in the south.

    Juvan
    Trier

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    • 16 February 2011 09:12, by Dinka domanited SPLA

      juvan shairing of oil was just a political talke but no real. now it is real

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  • 16 February 2011 09:20, by Mabor Yiel

    Mr. Secretary,

    This is what i know for the first day i cast my vote that there will be no sharing of oil revenues between these Two Nations.

    The only problem now left is who will be the good leader to distributes these National wealth equitably among the citizens.

    Watch out

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  • 16 February 2011 09:45, by Padiet Deng Alony

    NO more oil sharing 100% now belong to Southern Sudan Gov’t

    we need to build our own oil refineries one in Maluth county/Palioch Northern Upper Nile State to be and Bentiu unity State so that we run our machines with that fuel.

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  • 16 February 2011 10:07, by Sam.Eto

    Pagan Amum is a drunken idiot ! No one in the North asked for oil to be shared. But the South will pay a big fine for the transport and refining of the oil. The North has made it clear - oil in the South belongs to the South - That in the North belongs to the North (including Abyie - Bamboo and Heglig). If any of you illiterates knew - 30% of Sudan’s oil is produced in the North - i.e 110,000 from the 500,00 - 190,000 by the end of this year. The North is not going to collapse. The stupid Amum suggested giving grants to the North - HA HA HA what a joke. You have to have money first to give it you idiot. The GOSS is broke and worse off at the present time - No alternative source of money, no investment, no production. The GOSS is sending its minister Alor to the states to beg for money. No one is going to invest in the South while these savages butcher each other. There was a reason why the massacre occurred in Jungulai state - Because Total was going to start exploring. But that does sound like its going to happen any time soon.

    I suggest Amum stop this arrogance and start cooperating in a like mind fashion. Otherwise this Zionist fool will find himself hated by many more people..

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  • 16 February 2011 10:16, by Sam.Eto

    p.s did you guys see how the world is laughing at your new Anthem - calling south Sudan "Cush" - Everyone knows Cush is in North Sudan and they are wondering why you would sing about the land of your enemies - the people that treated you like second class citizens. The Bible mentions Cush - but it wasnt referring to South Sudan.

    It is an insult to the current descendants of the Kushites - Nubians, Nuba people, Mahas and Halfawieen. Your people still run around naked without even the simplest idea of civilization. Where introduced to clothes by the Northerners. How on earth could you relate yourselves to the great civilization of "Cush".

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    • 16 February 2011 10:53, by Gatbentiu

      Sam Eto,I know you ’re fully paid to posted this useless commence,Pagan has done enough for the South starting from bush to the present,if you compared your useless mind with him he is 100% liberator.I know you ’re not Jalaba but useless Nuba who is only fit to dig latrines and wash clothes for the jalaba,the Cush you mentioned is South Sudan read that Bible again and digest the means and quotes there.

      You talk of everyone knows that Cush is North who is that everyone? your boss Jalaba?
      Be with them and they ’ll kick your ass always.

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      • 17 February 2011 07:24, by lierpiou

        GatBentiu

        read wide,expand your brain and all researches state that Cush(kush) is in the present day Northern Sudan. we southerners fitted that identity on ourselves, but that isn’t the case. I was ridicule by one professor here in the west by asking me to explain our claim of cush being geographically in South but was disappointed to concede it wasn’t but the anthem was composed by some semi-illiterate groups with no sufficient understand of ancient history. KUSH IS NOT IN SOUTHERN SUDAN,guys,get that out of your brains.

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    • 16 February 2011 15:43, by Sudani Logik

      P.S

      No national anthem has yet been declared by the south, they have only confirmed the flag, country name and currency. The anthem you mentioned is unofficial and was fiercely criticized by many southerners themselves, so stop your generalization.

      The Cushites were black Nubians and not the current diluted Arabized Nubians, in fact the people of the Nuba mountains are more culturally linked to the ancient Cushites than the Halfaween or Mahas.

      I know there’re a lot of ignorant, tribalistic idiots commenting on this site but rest assured that there’re many well learned people visiting this site too.

      Instead of concentrating on the negative and constant insults of southerners who have suffered enough, you should try to reconcile and promote good relations for the future between the two states, at least this would go some way in healing the deep wound caused by the years of oppression implemented by your likes.

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  • 16 February 2011 10:42, by Sam.Eto

    A couple of things to point out is that the agreed upon border puts much of the discovered producing oil in the north (Heglig, Bamboo etc) whereas as the south gets Unity, Toma and Toma South fields as well as the discovery that Lundin oil made near Abyei (can’t remember the name of the field). Unity has been producing the longest and hence has the least reserves remaining....Toma and Toma South have very high wax content are relatively expensive in terms of treatment (pore point depressant and flash heating). The southern reaches of the Muglad basin are relatively unexplored and for good reason. This area is swamp and under water for much of the year. Lundin used Lousiana swamp buggies in order to acquire seismic and they were in a relatively dry portion of the south. It will be a huge challenge to develop this area.
    More importantly I need to correct the idea that the south is "mainly Christian" and the north "muslim". In reality the south is a mix and mostly animist, not Christian. The north is comprised mainly of muslims but there are Coptic churches in Khartoum and the copts are left to their own devices. The south was fraught with tribal warfare for generations prior to the troubles with the Khartoum government. I can’t see any reason to suspect that situation will change which likely means development of oil infrastructure in the south will be a long drawn out process.
    One of the issues that everyone misunderstands is why the Khartoum gov’t didn’t put up much of a fight over turning over oil fields to the south. The south still has to pay for access to the central processing plant and the pipeline infrastructure. From the Khartoum gov’t perspective the facilities were capitalized quite awhile ago so basically they may lose some oil revenue but they will make up for some of that in pipeline tariff revenue. A pipeline south to Lamu is a bit of a fantasy to my mind. You would need a heck of a lot more oil to justify it. The Uganda pipeline that Tullow will be involved with doesn’t go north but rather goes south and then directly east so there would be no synergy with a Sudan line.

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    • 16 February 2011 11:05, by Gatbentiu

      I know you ’re working with these useless oil companies which were given a contracts by Khartoum but let me assure you very soon you ’ll only wash clothes in Khartoum as we ’re going to end all the contracts signed by these companies with Khartoum and more importantly the employees ’ll only be Southerners.
      Even without oil still we can survive as the South is rich in agriculture.

      dholbentiu@gmail.com

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    • 16 February 2011 14:31, by Sudani Logik

      Sam,

      Why you so mad and pathetic! The south has its fare share of problems and will see troublesome times before sustained development can take hold.

      But clearly you’re mad about something, you need a hug or something! Its ironic that you seem to shout about the potential problems of the south and forget about the north’s fate:

      1) A significant drop in national revenue
      2) Loss of manpower, albeit mainly in the cheap labour market and civil service sector
      3) Rising inflation
      4) Bashir cannot travel freely to promote the interest of the state
      5) Systematic corruption
      6) Loss of contribution to the local economy by 15-20%

      Stop being mad, and start being realistic. Since the north will follow anything remotely Arab, regime change is just around the corner. Now grow up....

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      • 16 February 2011 22:36, by mohammed ali

        Mr.Logic,
        Certainly there are huge problems in the north, but does that solve the problem of the South, is it a competetion.

        For sure we have problems , regardless of the south’s problems , and we wish the south all the best .We are not in a competetion with anyone, we just want to be better for ourselves, and if the situation is bad in the south , it does not make us good .

        As for Pagan rehetoric, it is a Pagan’s rehetoric! For northerners if things in the south are in the hands of Pagan , people will tell him drink your oil, we neither want your fees nor do we want to share anything with you! Fortunately , there are wise people in the south, who can solve problems amicably and friendly!

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        • 17 February 2011 12:31, by Sudani Logik

          Mohammed

          Sometimes, you can be reasonable but other times you sound like the other bigots on this site. Its very hard to make out your real stance!

          The reason you hate Pagan so much, is because he tells the northerners the truth and what they don’t want to hear. Since you’re being somewhat reasonable for now, why don’t you just offer an apology for the ills committed by the people you love to support so much, the soon to be history NCP. As well as accepting that African Sudanese have been victimized by successive ruling elites since 1950s.

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          • 17 February 2011 21:16, by mohammed ali

            Logic,
            Well I have or at least am trying to be resonable! All Sudanese are Africans and they still live in Africa!

            Why should appologize to African Sudanese since I am African and Sudanese? moreover I have never ruled anyone and I am not going do that, for sure. It is simply funny!

            Pagan never tells the truth, he made all the mess during the elections in the south and nohe is trying to do it again by clinging to the power!

            That the NCP is going to be history, is possible , nobody is going to survive for ever! But I am sure that I heared this from you before and nothing happened!

            Please stop pretending to be southerner , you are not!

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  • 16 February 2011 10:54, by Jalaby

    HAHAHAHAHAHAHAHAHAHA .. HAHA

    Pagan, how idiot you are? why do you lie to your people??!! will you only hire the pipeline from the north? that’s not true, you will hire the pipeline + refineries + exporting fees for using Port Sudan + shipping back cost for your use in the south!

    No problem our fees will be 40% if you don’t like our deal then use cups and bottles to export it through Kenya .. HAHAH!

    Be aware that we will soon give you an appologize letter that we can no longer carry out your oil as soon as our new oil is ready for exporting, it is just a matter of time Pagan .. don’t cry baby!

    Jalaby (Abo Tagia)

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    • 16 February 2011 12:00, by Southern_Stocker

      Ya Jalaby
      every thing is possible, until we southerners stop poking our senseless noses into something not our concern......

      I dont know why people discus oil busines under verandas at souk al arabi and stinky souk konyo konyo, while forgetting that this black substance (OIL) make up one of the most sofisticated jobs and business in the world.

      Please leave this space for those who know it...better for farmers go look after their crops and for cattle herders go look after their cows... because in short term you will need those.

      For the lazy one who recently learned englis please go get your selves jobs and stop creating kios. There is a real business here no joks this is not souk sity where any one can come and through any useless theory with out any prove.

      if not few Im sure non here can realy talk about oil busines because you ignorants dont know how much it takes to make this Oil end up at the buyer’s hand.

      Please shut up if you dont know any thing.

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      • 16 February 2011 12:47, by Jalaby

        Ya Southern_Stocker,

        You better listen to the fact despite if it is so hard to believe rather than closing your eyes till you face the catastrophe!!

        Ignorant Pagan is trying to use a weapon (oil) against north despite he knows if the south fire the bullet north will survive but it will turn back to hit and kill the south!

        Just imagine what will happen if the north decide to shut down the pipeline against the south oil?? will the south survive while they rely totally on the oil revenue? the answer is no!

        North now produces around 110k barrel per day which exceeds their daily need and can export the surplus, we have the alternative of 50% revenue from the south oil that we will loose, we have gold that we expect to make 3 billion dollar revenue this year, we have cements that will also be part of our foreign currency income because of our new cement factories in Nile State that became one of our circle production, iorn, arabic gum, etc.

        By the end of this year we will be able to produce 195k barrel per day (BPD), by 2014 we will be able to produce 315k BPD.

        South Sudan secession is really good news because we fully cured from the migrain headache that was caused by southerners .. good luck buddy .. but please do not put all your problems and failure resonsibility on the north!

        Jalaby (Abo Tagia)

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    • 16 February 2011 16:28, by mack waweru

      Jallaby ( Abo Tagia),

      Let me remind you that your northern pipeline and refinery facilities were not created by God. They were constructed not by northerners, but by Chinese and Malaysian oil companies.
      We cannot use cup and bottles to transport our oil to the world market if overcharge or deny us your facilities. We will find ways as we did during our struggle against you to make that.
      We managed to achieve great things, do you think oil transportation is going to a big thing for us?
      Don’t lie to us that North has oil. Go back to Gezira agricultural scheme and farm dura to make kisra with baamia.
      There is oil in Darfur and it is not a northern region. There is gold in Port Sudan and it is in the east, not north.

      You are really "Abo Tagia" and that is why you know thing but lies.
      Mack

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      • 16 February 2011 23:13, by mohammed ali

        Mack,

        We will certainly go to Algaziera and farm ’durah’ and ’bamia’They are vital.Food is much more expensive and important than oil and there will be world wide food shortage!

        Food aid is going to be something from the past

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  • 16 February 2011 12:49, by william

    Absolutely, I agreed with one commentator who said the existing Oil-pipeline in Sudan is not belong to
    the North Sudan Government therefore, we need not to pay them any percentage unless to be determined by national assets distribution. Beside that the current Government of southern sudan can creates another pipeline in Mambasa Kenya and close up that in north/enemy terroritory.

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    • 16 February 2011 13:47, by Jalaby

      Ya William,

      How old are you? I think we have too many babies commenting in this post!!!

      Do you think it is so easy to build a pipline through Kenya or how long it will take? I think that pipeline is so easy to be built overnight and solve the problem!

      Well, the pipeline does not belong to north and you won’t pay to them, great, how can you take it from north if they refuse to share it with the south? will you fight them and then beat them and pull it from the ground and divert it south??

      Well, I don’t believe the north have the right to own the pipeline but I believe Arab/Jalaba do not have the right to stay and live in the north since they came from Aran peninsula and north originally belongs to south! since fact is fact then white people in America should go back to Europe and leave America to native Indians!

      Jalaby (Abo Tagia)

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      • 16 February 2011 14:56, by Sudani Logik

        Jalaby

        The pipeline, refineries and exporting terminals (Port Sudan) is still being paid for and its currently owned by a consortium including the government of Sudan.

        The national asset post referendum discussions includes all the above mentioned assets which logically mean, the south will ultimately own a share of those assets or be bought out at a price the government of Sudan can’t currently afford. You may ask for 40%, as the north ruling elite are accustomed looting and cheating but its very doubtful, you’ll get it. If the GoNU fires a single bullet, they too will collapse as both regions depend heavily on oil revenue. As for the agriculture, I suggest you do some research before barking like a mad dog, did you know that Sudan generated far greater income from that sector in the 60s, 70s and 80s than they do now?

        You ask if another commentator is a child here, but you sound like the child! You’re only getting rid of a headache with the breakaway of the south but most southerners are getting rid of oppression, racism, marginalization, intolerance and idiots like you.

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        • 16 February 2011 22:20, by Jalaby

          Ya Sudani Logik,

          70% of the pipeline is owned by north Sudan government and only 30% is owned by the chines company, by 2014 we will own 100% of it and we can own it now if we pay off all the debt.

          You said "southerners are getting rid of oppression, racism, marginalization, intolerance" what an idiot and liar you are!!! just tell us, why SPLM and jonobean insisting and asked Americans to put pressure on north to give southerners dual citizen!!! why southerners are so desperate to have northern citizen if the southerners were marginalized, oppressed, and were subject to racism??!!

          stop lying jonobean no one opressed you our discriminated you but it is your sick Psychology and mentality otherwise convince us why do you need to have our bad citizen??!!!

          Jalaby (Abo Tagia)

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          • 17 February 2011 13:01, by Sudani Logik

            Jalaby,

            You are truly a misguided child, now who’s lying? Whatever % the government of Sudan owns in assets, it will be divide it with the south, so the pipeline is not and will not be owned wholly by the north unless ofcourse they buy out the southerners. All of the oil facilities were built using petro-dollars and since majority of that comes from southern oil fields, your stupid assumptions are a joke, you must think that the southern negotiating team are a bunch of camel herding nomads from Al-Jazeera state or something. Learn some Simple facts before attempting to debate.

            Dual citizenship is in place in many countries, if some southerners were born in the north and feel they are part of North Sudan, then they should be afforded the same rights as bigots like you. Many Muslim Americans disagree with their government’s action in Pakistan, Iraq and Afghanistan but they’re still getting US passports if they meet the criteria, so refrain from using illogical arguments in regards to this issue.

            The very fact you deny that African Sudanese were/ are subjected to marginalization by the ruling elite and their followers (your likes) indicates your lack of reasoning, so the wars in Sudan were/ are just for fun as far as you’re concerned? How pathetic are you man.

            wake up, or wash that Jalabia and remove that imma from your eyes, am glad not all northerners are like!

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  • 16 February 2011 15:01, by mack waweru

    It’s so ridicules to talk of sharing oil revenue proceeds with the North after independent. The North has already stolen thousands and thousands billions of oil barrels from Southern oil fields and is in storage in El Jailiey, north of Khartoum and near Port Bashir.
    The theft started since 2000 till 2007. The current oil wells in operation in the south we talk about as "our oil, our oil" will dry up in 2015.
    Hiring the pipeline and refineries would be good instead of continuing to split it 50/50. South was also cheated on its 50 share.

    Mack

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    • 16 February 2011 15:44, by william

      You son of bitch called jalaba your name has spelled out that you are a purely looter of southern sudan revenue. So my ages are non of your concern, the issue was not just to pick the oil pipline today and erect it at mambasa but put in your attention that in light of our independecy there will be no tie between north and south at all. Just to let you loot as much as you can before july.

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  • 17 February 2011 06:41, by Jur Tier

    From the economical point of view, The idea of South Sudan renting a pipeline that belongs to the North is a big mistake should the Southern politicians be in a position to proceed with that plan.

    The two nations namely south and North would still need to go through a number of process in order to to trust each other.
    Take ,for example, the recent fivety-fivety percent oil sharing signed During the CPA. How sure are Southerners that the oil revenues were shared equally as agreed in the CPA?

    Southern politicians need to understand that there is a massive cheating in the revenues sharing and that should end as soon as South announce its official independence this July.

    The following questions should have been asked by them:

    How many barrels of oil were extracted per day?
    Who counts the barrels?
    Who export the oil?
    Who receive the Money before being shared equally?
    Is the money receive in dollars or the local currencies?

    These questions should have been raised before going ahead with such plans.

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  • 18 February 2011 23:40, by Sam.Eto

    Big oil trouble brewing in South Sudan

    February 18, 2011
    PrintSend to a FriendTweet this Analysis

    * Analysis by: Michael Lynch

    Summary

    The state of South Sudan that will become the world’s newest nation in July will not share its oil wealth with North Sudan. The secretary general of the Sudan People Liberation Movement, Pagan Amum, told reporters that "the notion of sharing wealth will not be there." The South will only pay a fee for the use of the pipeline to Port Sudan. North Sudan is currently in economic crisis with soaring inflation and shortages of hard currency. Officials in the North say they can find new oil fields.

    Analysis

    The above is an extract from an article from Ridder/Tribune Business news as reported by the Rigzone Newsletter of February 18. This is a classic case of confrontation between the haves and the have nots. The powder keg in all this is that the Northerners (the have nots) control the only pipeline to deep water. The South (the haves), controlling most of the oil production are asking for trouble. The question is whether or not the Asian owners of the concessions can bring wisdom to this debacle. It is a certainty that they want to keep the oil flowing (all 500,000 bbl/day of it). Greater NIle Petroleum Operating Company, a consortium led by China National whose partners are Petronas, Sudapet, Nigeria Express Petroleum and the Sudanese firm High Tech Group, control a good portion of the oil production and they will use every diplomatic trick in their portfolios to keep the situation from becoming explosive. China National also operates a 100,000 bbl/day refinery in Khartoum which is important for both North and South. Still most of the crude oil that arrives at Port Sudan comes from the South and goes to China, India and Malaysia. China and India consider Sudanese oil to be strategic for their future development. They won’t take kindly to a disruption. The history of Sudan since the long civil war began in 1985 is far from encouraging. Will the two states find common ground? Will the region lapse back into civil war? If 500,000 bbl/day of crude is removed from the international system in July, today’s $100/bbl Brent Blend will look cheap.

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