SOUTH SUDAN: High level delegation from China visits South Sudan to sign bilateral deals and new oil contracts

Record ID: 344129

  • Title: SOUTH SUDAN: High level delegation from China visits South Sudan to sign bilateral deals and new oil contracts
  • Date: 16th January 2012
  • Summary: SLATE INFORMATION
  • Embargoed: 31st January 2012 12:00
  • Keywords:
  • Location: South Sudan, South Sudan
  • Country: South Sudan
  • Topics: International Relations,Politics,Energy
  • Reuters ID: LVAC16LBEVWCEZV3QV0IV8ZK5QKP
  • Story Text: China has moved to deepen its partnership with the oil-rich state of South Sudan, sending a high-level team from the ruling Communist Party of China to sign bilateral deals with counterparts in the world's youngest nation.
    South Sudan voted overwhelming for independence a year ago and became an independent nation in July 2011.
    China, the largest recipient of South Sudan's 350,000 barrel per day crude oil production, is seen as a key mediator in post-secession negotiations with Khartoum over a raft of unresolved issues including oil, border territories, transitional funding and financial arrears.
    "China is going to send us a large medical team to come and help in service delivery in the health sector, and many other developmental programs are also in the pipeline," said Antipas Nyok, secretary general for political affairs from the ruling Sudan People's Liberation Movement (SPLM).
    The other programs are a borehole project in South Sudan, a grant for an undisclosed sum from China, a memorandum of understanding between China's Exim bank and South Sudan's ministry of finance, and the training of South Sudanese oil workers.
    "The main purpose of this visit is to reconfirm the friendship between our two parties, between our two countries and between our two peoples," said Ai Ping, vice minister of the central committee of the Communist Party of China.
    At the same event, South Sudan signed new Exploration and Production Sharing Agreement contracts with six oil companies, including the China National Petroleum Corporation, effectively taking full legal control over the industry from Khartoum.
    Landlocked South Sudan says the contracts will strengthen its hand at negotiations with Sudan, which has plunged already strained relations to a new low in the last few months.
    Juba accuses Khartoum of seizing its crude oil as it passes through Sudan on its way to port and refusing to allow ships carrying the South's oil to leave port.
    Authorities in Sudan admit that they are taking oil but say it is in lieu of payments for use of its pipeline and processing facilities.
    Pagan Amum, South Sudan's chief negotiator says that because of the new contracts, the oil companies have sent a letter explaining that the South is up-to-date with all payments and that the talks, which resume on Tuesday January 17 should now focus solely on a transit fee.
    "Now the government of Sudan has no legal or economic or commercial basis to charge South Sudan any penny, except transit fee," Amum says.
    South Sudan hopes the backing of the oil companies, particularly CNPC, will help leverage diplomatic pressure on Sudan and help resolve the issues and ease tensions.
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