News / Africa

South Sudan Gambles Big With Oil Shutdown

South Sudanese express their support as President Salva Kiir declared a halt on all oil operations in South Sudan, in Juba, January 23, 2012.
South Sudanese express their support as President Salva Kiir declared a halt on all oil operations in South Sudan, in Juba, January 23, 2012.
Gabe Joselow

South Sudan is shutting down its oil production to protest against high fees Sudan charges to transport the commodity through northern pipelines. The move threatens both countries' economies and is heightening tensions that have festered since the south declared independence in July.

The government of South Sudan says it already has cut oil output in the country by more than half and plans to continue reducing outflows unless Sudan meets its demands.

South Sudan had shut down most of its wells by the end of the day Tuesday in the north central parts of the country. The process is continuing in Upper Nile state in the east, home to the bulk of the country's oil fields.

Continuing conflict

The shutoff is the latest development of an ongoing dispute between the two Sudans on how to share oil revenues following their split last year.

South Sudan claims the north has confiscated $815 million in oil from the south. Khartoum says it took the oil to compensate for lost revenues.

Sudan also is charging the south transit fees as high as $36 per barrel - far above the industry standard - which is closer to $1 per barrel.

South Sudan's Petroleum and Mining Minister Stephen Dhieu Dau says that Khartoum's terms are unacceptable.

“We also have been paying the operation costs for the pipeline and marine terminal and covering all these facilities. But Khartoum, unfortunately, is imposing punitive fees, discriminatory fees, against South Sudan as a penalty for the secession,” said Dau.

Heavy reliance on oil money


More than 90 percent of South Sudan's revenues are derived from oil exports. The country, at its creation, inherited three-quarters of the known oil reserves in the former united Sudan. The separation is said to have cost Khartoum more than $7 billion in lost revenue.

While South Sudan produces the bulk of the crude oil, though, it has no refining capacity, and relies on northern pipelines to export.

The move to shutdown the pipelines will cost both countries economically, but Dau said the south has considered the alternatives.

“You will come to one answer. Either you produce, you get zero - or you shut down, you get zero and Khartoum gets zero,” said Dau.

AU summit negotiations

The leaders of the two Sudans are expected to meet on the sidelines of the African Union summit in the Ethiopian capital Addis Ababa. An AU panel that has been mediating the negotiations submitted a new draft proposal this week to resolve the dispute.

Dana Wilkins, a campaigner at Global Witness, a natural resources monitoring group, said the south has a lot to lose if its gambit does not work.

“South Sudan in particular is going to feel the hit on revenues pretty quickly. It's not clear just how much they have in savings, but what is clear is that they're going to have to rely heavily on the international community for financial support over the coming year if this shutdown happens in full and the negotiations don't come to at least an interim arrangement,” said Wilkins.

South Sudan is exploring alternative transit routes for its oil. The government announced this week it has struck a deal with Kenya for a new pipeline stretching to the town of Lamu on the Indian Ocean. But it was not clear when the pipeline may be started or finished.

You May Like

Republican Majority in Congress Off to Rough Start

Standoff over Homeland Security funding exposes philosophical, tactical problems within party More

Pakistan Blocks Baloch Activist from US Trip

Human Rights Commission of Pakistan slams Islamabad officials for stopping people from leaving country to attend human rights conference More

Video Muslims Long Thrived in North Carolina Before Students Killed

Idyll shattered February 10, when three Muslim university students living in Chapel Hill were gunned down by a neighbor More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Muslims Long Thrived in N Carolina Before Slaying of 3 Studentsi
X
Jerome Socolovsky
March 05, 2015 9:04 PM
The killings of three Muslim students in North Carolina early last month came as Muslims across the United States have felt under siege, partly as a result of terrorist attacks being committed internationally in the name of their faith. But Muslims have long thrived in university cities in this part of the American South. VOA's Jerome Socolovsky reports.
Video

Video Muslims Long Thrived in N Carolina Before Slaying of 3 Students

The killings of three Muslim students in North Carolina early last month came as Muslims across the United States have felt under siege, partly as a result of terrorist attacks being committed internationally in the name of their faith. But Muslims have long thrived in university cities in this part of the American South. VOA's Jerome Socolovsky reports.
Video

Video Fuel Shortages in Nigeria Threaten Election Campaigns

Nigeria is suffering a gas shortage as the falling oil price has affected the country’s ability to import and distribute refined fuels. Coming just weeks before scheduled March 28 elections, the shortage could have a big impact on the campaign, as Henry Ridgwell reports for VOA.
Video

Video Report: Human Rights in Annexed Crimea Deteriorating

A new report by Freedom House and the Atlantic Council of the United States says the human rights situation in Crimea has deteriorated since the peninsula was annexed by Russia in March of last year. The report says the new authorities in Crimea are discriminating against minorities, suppressing freedom of expression, and forcing residents to assume Russian citizenship or leave. Zlatica Hoke has more.
Video

Video 50 Years Later African-Americans See New Voting Rights Battles Ahead

Thousands of people will gather to mark the 50th anniversary of a historic civil rights march on March 7th in Selma, Alabama. In 1965, dozens of people were seriously injured during the event known as “Bloody Sunday,” after police attacked African-American demonstrators demanding voting rights. VOA’s Chris Simkins introduces us to some civil rights pioneers who are still fighting for voting rights in Alabama more than 50 years later.
Video

Video Craft Brewers Taking Hold in US Beer Market

Since the 1950’s, the U.S. beer industry has been dominated by a handful of huge breweries. But in recent years, the rapid rise of small craft breweries has changed the American market and, arguably, the way people drink beer. VOA’s Jeff Custer reports.
Video

Video Video Claims to Show Shia Forces in Iraq Executing Sunni Boy

A graphic mobile phone video is spreading on the Internet, claiming to show Iraqi forces or Shia militia executing a handcuffed Sunni boy. Experts have yet to verify the video, but already Islamic State followers are publicizing it across social media, playing on deep-rooted sectarian fears. VOA’s Jeff Seldin reports.
Video

Video Ukrainian Authorities Struggle to Secure a Divided Mariupol

Since last month's cease-fire went into effect, shelling around the port city of Mariupol has decreased, but it is thought pro-Russian separatists remain poised to attack. For the city’s authorities, a major challenge is gaining the trust of residents, while at the same time rooting out informants who are passing sensitive information to the rebels. Patrick Wells reports for VOA.
Video

Video Volunteer Gauge-Watchers Help Fine-Tune Weather Science

An observation system called CoCoRaHS is working to improve weather science, thanks to thousands of volunteers across the country who measure precipitation in their own backyards, then share their data through the Internet. VOA's Shelley Schlender reports.
Video

Video NASA Spacecraft Approaches a Dwarf Planet

NASA’s Dawn spacecraft will make history on Friday, March 6, when it becomes the first man-made object to orbit a dwarf planet named Ceres. It is located in the asteroid belt between Mars and Jupiter, almost 500 million kilometers from Earth. Among other objectives, Dawn will try to examine two mysterious bright white spots detected on the planet’s surface. VOA’s George Putic has more.
Video

Video Young Muslims Radicalized Online

Young Muslims are being radicalized ‘in their bedrooms’ through direct contact with Islamic State or ISIL fighters via the Internet, according to terror experts. There are growing concerns that authorities and Internet providers are not doing enough to counter online extremism - which analysts say is spread by a prolific network of online supporters around the world. Henry Ridgwell reports from London.
Video

Video Positive Messaging Transforms Ethiopia's Image

Ethiopia was once known for famine and droughts. Now, headlines more often point to its fast-growing economy and its emergence as a regional peacemaker. How has Addis Ababa changed the narrative? VOA's Marthe van der Wolf reports.
Video

Video Answers Elude Families of MH370 Passengers

For the families on board Malaysia Airlines flight MH370, an airline official’s statement nearly one year ago that the plane had lost contact with air traffic control at 2:40 AM is the only thing that remains confirmed. William Ide reports.

All About America

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More