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Page last updated at 11:47 GMT, Monday, 7 September 2009 12:47 UK

Sudan rejects oil revenue report

Oil pipe in Heglig, Sudan
Oil accounts for 98% of the budget of southern Sudan

Sudan's government has denied accusations in a report that it may be benefiting unfairly from oil revenues.

Following the 2005 agreement to end 22 years of civil war, the north and south are meant to share the revenue.

A presidential adviser told the BBC the report by campaign group Global Witness was wrong to suggest discrepancies in the reporting of oil revenues.

Abdullah Massar told BBC Arabic that the south was represented in all state bodies that dealt with oil.

Map

Global Witness has called for greater transparency in the oil industry, which is effectively run by the north, and accounts for 98% of the budget of southern Sudan.

The group said it found a difference of between 9% and 26% in the production figures provided by Khartoum and the Chinese firm operating the oilfields.

However, Mr Massar said southern Sudan - and its Sudan People's Liberation Movement (SPLM) party - was fully involved in the oil process.

ANALYSIS
James Copnall
James Copnall, BBC News, Khartoum

Sudan's north and south are divided on ethnic, religious and cultural lines. But the two are united in their desire for the wealth oil brings - to the lucky few at least.

Global Witness is careful not to accuse directly the north of cheating the south out of oil revenue.

But there is no doubt this report will be interpreted in this way by southern politicians - who have made similar accusations in the past. Those same southern leaders frequently face accusations of financial mismanagement of their own.

The Comprehensive Peace Agreement, which was signed in 2005, is under real pressure, in the run up to elections and the 2011 referendum on whether the south wishes to remain part of Sudan. The squabble over who Sudan's oil should benefit is a huge part of this.

"This is not true. Firstly, the southern government has a representation in the oil commission," he said.

"It also has a state minister in the finance and energy ministries from the SPLM where oil is being sold and bought. They are present in all state institutions."

Southern officials have accused the north of withholding oil money in the past, although our reporter says they are frequently accused of corruption too.

But in response to the Global Witness report, the SPLM's secretary general reiterated that the south was largely excluded from oil management.

"[The North] are rejecting any kind of transparency and there is a complete absence and exclusion of southern Sudan and its representatives from the management and selling of this Sudanese product," Pagan Amum told the BBC.

Global Witness said a total undercount of 10% since 2005 would mean "the southern government would be owed more than $600m (£365m)".

"It's difficult to imagine why an oil company would have a reason to over-estimate its oil production," Rosie Sharpe, one of the authors of the report, told the BBC's Network Africa programme.

"We know that oil companies sometimes over-estimate their reserves, but not their daily oil production.

"Whereas it is easy to understand why the Khartoum government might have an interest in understating its revenues."



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