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Border Crossing to Sudan's Heglig Oil Field to Reopen

Source: Reuters 4/19/2013, Location: Africa

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Clashes over a disputed oil-producing border region edged South Sudan and Sudan ever closer to full-blown war. Sudan's President Omar Hassan al-Bashir, in a rousing speech, told thousands of supporters in the Sudanese state of North Kordofan: "Heglig is in Kordofan". Both sides traded claims and counterclaims over the Heglig oil field and it was bombed and damaged during fighting last weekend.

The Dispute

* Fighting has been fuelled by quarrels between the two countries over issues including the exact position of their shared border, control of disputed areas, the status of citizens in one another's territories and oil payments.

* Sudan lost three quarters of its oil output when South Sudan seceded in July 2011. The former civil war foes have since wrangled over how much the landlocked new nation should pay to export crude via the north to a Red Sea terminal at Port Sudan.

* In January 2012, South Sudan shut down its entire output of 350,000 bpd to stop Khartoum from taking oil to make up for what it calls unpaid fees for transit and use of its facilities.

Heglig Oil Field:

* Heglig contains a large oilfield which Khartoum controlled until South Sudan's army seized it last week. The field was central to Sudan's economy, which was already reeling from the loss of oil revenues after the South split off.

* The field is operated by Greater Nile Petroleum Operating Co. (GNPOC), a consortium of Chinese, Malaysian, Indian and Sudanese companies. GNPOC said last month it would go ahead with plans to increase output to 70,000 bpd from 60,000 bpd.

* Production at Heglig - known as the Greater Nile Oil Project - began in 1996 with the development of the Heglig and Unity fields, which are now the largest in the area.

* A 450,000 bpd pipeline stretches 1,000 miles from the Muglad Basin to an export terminal near Port Sudan, transporting oil from the Heglig, Unity and surrounding smaller fields.

* The oilfields within the blocks straddle both countries. While the Unity field is fully located in the South, parts of the border area around the Heglig field in Block 2 are still in dispute.

* To back its claim to the field, Khartoum has cited a 2009 ruling by the Permanent Court of Arbitration in The Hague that said Heglig was not part of the disputed Abyei territory. Maps issued by the court appear to put Heglig in the north.

* Juba hotly contested Khartoum's claim, often citing an internal boundary marked by British colonial administrators, and the ethnicity of the local population. Many southerners call the area Panthou.

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