December 21, 2016 (JUBA) – Sudan and South Sudan oil ministers have agreed to extend the 2012 Cooperation Agreement on payments from oil revenues for three years.
- A pipeline that transports crude oil from the south to Port Sudan (Reuters)
The South Sudanese Petroleum and Mining Minister, Ezekiel Lol Gatkuoth said Wednesday that the new deal gives the two neighbouring Nations “breathing space.”
“We have reached an agreement to extend the cooperation agreement in the petroleum industry for three years," Gatkouth told reporters on arrival from the Sudanese capital.
Under the terms of the Cooperation Agreement signed between Juba and Khartoum in 2012, South Sudan pays Sudan an overall $24 as transit fees charge per barrel of crude as well as transitional financial agreement amounting to $3 billion for a period of three years. The fall in the global oil prices, however, means South Sudan, which relies on oil for more than 98% for the national budget, struggled to pay government employees.
It, however, remains unclear of the price per barrel of crude oil would also be reduced.
“The two countries restricted the agreement to create breathing space. The agreement is an agreement we cannot change anything about it. It is restructuring so that we can pay less that what we used to pay,” stressed Gatkouth.
Both Khartoum and Juba, the South Sudanese Petroleum minister further disclosed, will also cooperate on providing security in the oil-producing areas along the 200km border.
“Business will start now, the talking will stop and we will now translate these things to implementation,” he added.