* S. Sudan looks to East Africa for route, official says
* Western firms keener to invest in independent S. Sudan
By Rebekah Kebede
PERTH, Sept 1 South Sudan is exploring
alternatives to transporting its oil through North Sudan, as the
two countries face a stalemate over dividing up oil revenues, a
government official said on Thursday.
South Sudan took 75 percent of the 500,000 barrels a day of
oil production when it became independent on July 9, but only
the north has a pipeline and a port to export the oil.
Last month, North Sudan halted an oil shipment from
landlocked South Sudan in a dispute over customs fees.
"We are having conversations. We are looking to the
alternatives," Pagan Amum, secretary general of the ruling
southern Sudan People's Liberation Movement (SPLM), told Reuters
at a mining industry conference.
"Meanwhile, we believe if Khartoum accepts a deal, it would
be in the interests of both Khartoum and the South," Amum said,
adding that he expects international mediators to encourage
Khartoum to be "reasonable" in negotiations.
Experts have said southern plans to connect to a pipeline in
east African neighbour Kenya are years away, but Amum indicated
that an alternative through East Africa would be more economical
than paying the $32 per barrel fee that Khartoum has demanded
for future use of its oil facilities.
Amum said the South Sudan government was not open to raising
its current customs fees to North Sudan, which stand at $4 per
barrel for old fields and $7 per barrel for new fields.
South Sudan has asked the African Union to find a compromise
after rejecting the $32 proposal.
South Sudan seceded from Sudan after a decades-long conflict
over religion, ethnicity, ideology and oil which killed some 2
Amum said the transition had led to increased oil investment
"There's a lot of interest from companies from the Western
world... the pariah nature of the Sudanese system made it
politically and morally difficult or embarrassing for Western
companies to be engaged," Amum said.
Sudanese oil flows mainly to Asia, with China buying more
than half of total volumes. South Sudan's production is
dominated by Chinese and Indian companies, which have been
marketing their crude themselves so far.
Earlier this year, South Sudan also signed a deal with
trading house Glencore to help it market crude, but a
dispute between various officials has threatened to derail the
(Reporting by Rebekah Kebede; Editing by Anthony Barker)