VZCZCXRO2800
RR RUEHROV
DE RUEHKH #1807 2081254
ZNR UUUUU ZZH
R 271254Z JUL 06
FM AMEMBASSY KHARTOUM
TO RUEHC/SECSTATE WASHDC 3926
INFO RUCNIAD/IGAD COLLECTIVE

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