South Sudan oil back in business

South Sudanese oil will be shipped again from Sudan by the end of May, official media said on Saturday, after a shutdown of more than a year which cost both impoverished nations billions of dollars.

"Sudan and South Sudan agreed to start oil pumping in mid-April and the exportation by the end of May," the official SUNA news agency said in a brief dispatch which gave no further details.

South Sudan halted crude production in early 2012, cutting off most of its revenue after accusing Khartoum of theft in a row over export fees.

At talks in Addis Ababa last month, the two countries finally settled on detailed timetables to ease tensions, after months of intermittent border clashes, by resuming the oil flows and implementing eight other key pacts.

The deals had remained dormant after signing in September as Khartoum pushed for guarantees that South Sudan would no longer back rebels fighting in South Kordofan and Blue Nile states.

But since timetables were agreed, official delegations from the two countries have held a series of meetings to begin implementing the oil accord and other pacts.

Following an independence referendum, South Sudan split from the north in 2011 with roughly 75 percent of the 470,000 barrels per day of crude produced by the formerly unified country.

The separation left Khartoum without most of its export earnings and half of its fiscal revenues, sending the pound currency into decline while inflation rose to more than 40 percent, where it remains.

Refineries and export pipelines stayed under Khartoum's jurisdiction but the two countries could not agree on how much Juba should pay to use that infrastructure, including the Port Sudan export terminal.

South Sudan said petroleum provided 98 percent of its revenue.

The oil deal is worth $1 billion-$1.5 billion annually in transit fees and other payments for Sudan, an international economist has estimated.

Billions more dollars would reach South Sudan from its oil exports.

The timetable document said operators must conduct the oil resumption "in a technically and environmentally sound manner and in accordance with international best practice".

Oil companies in South Sudan include Malaysian state-owned Petronas, China's National Petroleum Company (CNPC), and the Sudd Petroleum Operating Company (SPOC), a joint venture between Petronas and South Sudan's government.

From a low of around seven pounds on the widely used black market, Sudan's currency has strengthened since the timetable agreement brought a more positive tone in relations with its neighbour.

The currency now trades at just above six pounds for one United States dollar.

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