Sudan has decided to halt the oil exports of South Sudan's government because the two have not yet agreed on a transit fee for the new nation to export its oil through its neighbour, Sudan's acting oil minister said on Monday.
The government took the decision on 17 November, Ali Ahmed Osman told reporters, adding that the pipeline was still running and international companies would not be affected.
"We stopped only the share of the government of South Sudan," he said, adding that Sudan estimated South Sudan owed it around US$727 million for arrears between 9 July and the end of October.
South Sudan split off from Sudan to become the world's newest nation on 9 July, taking with it about 75 per cent of the former country's roughly 500,000 barrels per day of oil output.
South Sudan still depends on Sudan's oil infrastructure, including a pipeline running north to a Red Sea port, to export its crude. The two have yet to work out how much South Sudan should pay as a transit fee.
Oil is the lifeblood of both countries' economies, and accounts for some 98 per cent of South Sudan's government revenues.
Osman said Sudan had been allowing South Sudan to continue exporting on the expectation that the transit fees would be paid in arrears, but they had already gone more than four months without an agreement.