CPA: Petroleum Commission Still Stalled

UNCLAS KHARTOUM 001807 SIPDIS SIPDIS E.O. 12958: N/A TAGS: PGOV ECON EPET SU SUBJECT: CPA: Petroleum Commission Still Stalled ¶1. The wealth sharing working group of the Assessment and Evaluation Commission (AEC),chaired by the United States, met on July 17 to discuss the National Petroleum Commission, the Fiscal and Financial Allocation and Monitoring Commission (FFAMC),the conversion to a new national currency, and other issues related to the wealth sharing provisions of the CPA. There was no progress to report on the FFAMC and the currency, but the working group decided to invite representatives of the FFAMC and the Central Bank, responsible for the currency conversion, to address future meetings. ¶2. The Petroleum Commission was also not functioning due to a disagreement on its mandate and how early it gets involved in the exploration and production contracting process. The Sudanese People's Liberation Movement (SPLM) believes that the Petroleum Commission should control the entire petroleum contracting process from bidding and negotiation onward with its own secretariat. The National Congress Party (NCP) believes the commission's role should be advisory in the early stages, with the Ministry of Energy and Mining running the contracting process. The commission would then ratify the completed contracts. ¶3. The National Congress Party representative said that they were close to a compromise where the Ministry of Energy and Mining maintains control over the process, but the Government of Southern Sudan's (GoSS) Ministry of Industry and Mining takes some form of an active role throughout. The SPLM representative disagreed with this approach, and said that the only way to protect the interests of the people and make sure that environmental concerns were addressed from the beginning, was for the Petroleum Commission to run the entire contracting process from the beginning. The discussions became more heated and the two sides remained far apart. The Norwegian representative expressed concern that there had been no capacity building for the SPLM and its commission representatives, which would be necessary if the commission were to take any sort of role in this highly technical field. In response to a question from the United States, the National Congress Party representative explained that all new petroleum contracts were stalled until the Petroleum Commission was functioning. STEINFELD