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Fighting Erupts Near Capital of Sudan's Oil Producing State

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KAMPALA, Uganda - Fighting erupted near the capital of Sudan's oil producing South Kordofan state on Wednesday ahead of the planned resumption of transit oil shipments from former civil war foe, South Sudan, officials said Wednesday.

Sudanese air force and ground troops attacked positions of rebels of Sudan People's Liberation Movement-North on Wednesday in an attempt to halt a rebel advance on the city of Kadugli, South Kordofan's capital, Rabie Abdelaty, Sudan's government spokesman said.

"Our military has just repelled a rebel attack on Kadugli… an offensive is continuing to dislodge these rebels from our territory" Mr. Abdelaty said.

The latest fighting underscores the fragile security situation along the Sudan-South Sudan oil-rich common border. Oil fields in South Kordofan account for the bulk of Sudan's 115,000 barrels-a-day of oil output.

On Monday, the SPLM-N rebels shelled Kadugli, in the first major attack on the capital, which left at least five civilians dead.

The SPLM-N rebels fought alongside the South Sudan's army during the two-decade civil war with Sudan, which officially ended in 2005. South Sudan says it has since severed ties with the rebels, although Khartoum insists that Juba continues to back the rebels.

A rebel spokesman told Dow Jones Newswires that the rebels are fighting in "self defense" following days of a Sudanese army offensive. Last month, SPLM-N signed a ceasefire pact with Sudan to allow humanitarian aid into South Kordofan and Blue Nile states, however, both sides accuse each other of violating the pact.

The SPLM-N rebels say they are fighting to topple the Khartoum regime Many observers say that the latest fighting could hinder the implementation of the peace accord, agreed between the two nations last month in Ethiopia. After weeks of back and forth negotiations, the presidents of Sudan and South Sudan bowed to international pressure and signed a number of agreements on September 28 paving the way for resuming vital oil exports and creating a demilitarized zone along their contested border.

However, deep-rooted mistrust and suspicion have persisted, threatening the implementation of the agreements.

Land locked South Sudan threw the economies of both countries into turmoil in January after it halted oil shipments through Sudanese ports and pipelines amid a feud over oil transit fees.

South Sudanese officials say that shipments of as much as 350,000 barrels-a-day of crude may resume in the next 3-6 months following last month's deal.

Copyright (c) 2012 Dow Jones & Company, Inc.

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