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South Sudan accuses Sudan of $815m oil theft

South Sudan has taken with it 75% of Sudan's oil production of 470,000 barrels per day after the split (© 2009 AFP)

South Sudanese President Salva Kiir accused Sudan on Monday of stealing $815 million of the crude oil that makes up the new nation’s economic lifeblood, as it begins a production shutdown in protest.

Juba ordered on Friday a complete shutdown of oil production despite it making up some 98 percent of its revenue, amid a deepening row with former civil war enemies in Khartoum over pipeline fees.

“The crisis has reached a stage that is unacceptable — in total the revenue that the government of Sudan has looted since December amounts to approximately $815 million (626 million euros),” Kiir told parliament.

“At this time, we have no guarantee that the oil flowing through the Republic of Sudan will reach its intended destination.”

Khartoum admits to taking some South Sudanese oil destined for export as compensation until an agreement, but the South has said this is theft.

The South split from Sudan in July, taking with it 75 percent of the country’s oil production of 470,000 barrels per day, but the new state lacks the infrastructure to refine and export oil.

Crucial facilities including a pipeline and Red Sea export terminal remain in Sudan, leaving the two states arguing over how much the south should pay to use the infrastructure.

“We unanimously decided that all oil operations in South Sudan should be halted with immediate effect, and no crude oil belonging to South Sudan shall flow through the pipeline”, Kiir added.

Production stoppage has already begun, Minister of Information Barnaba Marial Benjamin told AFP.

“Some oil fields have already shut down since Sunday… We have given them [oil companies] two weeks to close operations for a full shutdown,” he added.

Kiir said that the grossly underdeveloped South — which is almost entirely dependent on the oil revenue to function — would “need to find other sources of funding,” and that austerity measures would be put in place.

“On existing cash reserves, rest assured that the government can operate for the immediate future, depending on which cuts are made”, he said, without giving details.

Kiir is due to meet Sudanese President Omar al-Bashir on Friday in the Ethiopian capital, where the African Union has been mediating talks.

Signature : JUBA (AFP)

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