ENERGY has been a divisive issue, fomenting wars and strife – in various nooks and corners of the world – for more than century now. A Century of Oil Wars – is an established and available document. The human quest for dominance makes it incumbent to assume control of energy resources – being the main driver of power and ascendancy in modern history. Yet, for a change a new beginning seems in the making. Energy resources, after all, could bridge differing groups and warring nations. It could help develop bondage between the otherwise fighting nations. After years of infighting, war and conflict, the warring factions of Sudan and South Sudan are finally on way to somewhat ‘forced reconciliation – courtesy (of) its energy resources.' For weeks, out in public and behind the scene, at the Sheraton lobby in the Ethiopian capital, energy diplomats with global powers keep an eye, nudge and push them toward peace and restoration of output from the Southern Sudan, interestingly via the Northern enclave, the only viable option available. Last year, after decades of civil war, South Sudan held a referendum and broke away from its northern neighbor. The division left land-locked South Sudan with most of the region's oil reserves; while Sudan retained the pipelines, most of the refineries, and Port Sudan — where oil is loaded onto tankers and shipped across the world. Analysts estimate that the two countries have between 4.2 billion and 6.7 billion barrels — a fraction of the estimated global reserve of 1,653 billion barrels. Petronas of Malaysia and the OVL, the arm of ONGC of India, are the primary players in South Sudan's oil sector. OVL has also financed and constructed a 741 km pipeline from the Khartoum refinery in Sudan to Port Sudan on the Red Sea. In January this year, South Sudan unilaterally stopped oil production after a dispute over the transit fee demanded by the North for use of its pipelines. Last month, the two countries arrived at an agreement on oil transit fees pursuant to a broader agreement on border security along a 10 km wide demilitarized zone. African Union chief mediator, Thabo Mbeki, on August 3 announced a breakthrough deal on oil transportation fees. In line with this agreement Juba will pay $11 for the oil produced in Unity state and $9.10 for the oil of Upper Nile. The South Sudan will also pay $3.028 billion as transitional financial assistance. The deal will last three and a half years. The two sides are now negotiating the fate of Abyei, an oil-rich province controlled by the North, but claimed by the South. A referendum on Abyei has been postponed indefinitely as both sides disagree over who should be allowed to participate in the referendum, said a South Sudanese official. South Sudan's Vice President Riek Machar has been openly bitter, yet realistic, of the deal reached under intense pressure from the international community, despite it leaving a huge gap of oil revenues lost to Khartoum. The vice president told the European diplomat that the new nation will lose a total of $12 billion to Khartoum under the deal. In detailing the figures of the deal, he said the average commercial agreement reached with Khartoum is $3.5 billion for the next three and a half years, which is inclusive of all types of fees. The arrears of commercial deal owed to Khartoum which dated back between July 9, 2011, when South Sudan became independent to January 2012, when the oil production was shut down, will also amount to another half a billion dollars, he said. The agreement has forced the new nation to become “the biggest donor on earth to a single country, Sudan", Machar underlined. Yet marking a new era, he reiterated, the necessity of the deal, adding that South Sudan was willing to buy peace and win Khartoum to become a good neighbor. Oil has been at the heart of tensions and economic difficulties for Sudan since the South separated in July last year with roughly 75 percent of the 470,000 barrels per day produced by the unified country before independence. The lost oil accounted for more than 85 percent of Khartoum's export earnings, which reached $7.5 billion in the first half of 2011, according to the World Bank. Fighting along the 1,800-km (1,200-mile) border threatened to boil over into a full-scale war in April when South Sudan seized an oil-producing region long held by Sudan. Tensions have eased since then as disputes seem to have taken a heavy economic toll on both sides, when landlocked South Sudan shut down its vital oil output in January after failing to agree with Khartoum how much it should pay to export through Sudan. And this is where the clock began clicking – putting economic pressure on both sides to reconcile and resolve. Mother geography continued playing swings. Indeed, when applied properly, energy resources could be used for the betterment of this war-festered world – one finally can somewhat underline.
