From Decades of Strife and Conflict, Africa's Newest Nation Is Born

South Sudanese girl hanging flag ahead of Independence Day

The boundaries on Africa's maps will once again be re-drawn, this time as the newest nation in the world readies itself for full independence from Sudan on Saturday. After a decade of civil war with Khartoum and an uneasy five year cease-fire, celebrations marking the formation of the new state are set to get underway in the South Sudanese capital of Juba on Saturday. This new nation will be slightly smaller than the state of Texas in terms of size.

Reportedly a number of expats will make their way to the new country from overseas for the occasion while a number of events as far afield as Sioux City, SD are planned for those unable to make it to Juba by July 9th.

South Sudan President Salva Kiir meeting with President Bush in 2009

The Republic of South Sudan came about as a result of the internationally-brokered Comprehensive Peace Agreement between the South and Khartoum that was signed in Nairobi. The terms of the 2005 ceasefire included six years of autonomy from Khartoum followed by a referendum on independence which took place earlier this year. Voters in the south overwhelmingly approved of secession from northern Sudan by a nearly 99% margin. The population of the South is largely Christian or Animist while the northern Sudan is majority Muslim.

Map of the new nation

Although rich in oil deposits, the South faces a number of challenges including rebuilding infrastructure damaged by years of civil war, AIDS, a high infant mortality rate. There is also the risk that lingering resentment towards the north could reignite into an armed conflict once again. To that end, the United Nations has sent approximately 7000 peacekeepers to act as a buffer between northern and southern forces.

There is also the problem of exporting the oil, since the new country is land-locked and the only pipelines into and out of the south are to Port Sudan and and easily be cut off if hostilities between the two nations resume.

Reveller in the capital city of Juba

The days and weeks leading up to the independence day have been marked with skirmishes with the northern militias and attacks on refugees. As recently as May of this year, forces from South Sudan and Sudan traded artillery fire and the Sudanese air force bombarded the region around the border town of Abyei.

China Eyes Alberta's Oil Sands As State Department Delays Keystone XL Pipeline Decision

While interests in both the USA and Canada are awaiting a State Department decision on a proposed pipeline linking northern Alberta's oil sands with Texas, Chinese companies are proposing a pipeline of their own linking the vast reserves with the Pacific Ocean.

The oil sands of this Canadian province are so big that they will be able to serve both of the world's largest economies as production expands in the coming years. But that will mean building at least two pipelines, one south to the Texas Gulf Coast and another west toward the Pacific, and that in turn means fresh environmental battles on top of those already raging over the costly and energy-intensive method of extracting oil from sand.

Most believe that both will eventually be built. But if the U.S. doesn't approve its pipeline promptly, Canada might increasingly look to China, thinking America doesn't want a big stake share in what environmentalists call "dirty oil," which they say increases greenhouse gas emissions.

Alberta has the world's third largest oil reserves, more than 170 billion barrels. Daily production of 1.5 million barrels from the oil sands is expected to nearly triple to 3.7 million in 2025. Overall, Alberta has more oil than Russia or Iran. Only Saudi Arabia and Venezuela have more.

Alberta is one of the few places where oil companies can invest, as the majority of the world's oil reserves are controlled by national governments. Only 22 percent of the total world reserves are accessible to private sector investment, 52 percent of which is in Alberta's oil sands, according to the Canadian Association of Petroleum Producers.

At issue are environmental concerns over two proposed pipeline projects. The Northern Gateway Pipeline would pump oil from Edmonton, AB over the Rockies to a new maritime terminal in Kitimat, BC for export to China. China's state oil company, Sinopec [NYSE: SHI] reportedly has a stake in excess of US$ 5 billion in the plans drawn up by Alberta-based Enbridge [NYSE: ENB/TSX: ENB].

Map detailing already existing pipelines and proposed expansion

Meanwhile, running to the south is the Keystone XL project, much of which is already in place, but Phase 1 takes a circuitous zig-zag route through Manitoba before stretching south across the border to Steele City, NE. From there, the pipelines diverge with one heading east to Patoka, IL and the other heading south to Cushing, OK (See map above). The proposed extension (Phase 4) by pipeline owner TransCanada [NYSE: TRP/TSX: TRP] would bypass Phase 1 and take a more direct route from Alberta by cutting through eastern Montana, then western South Dakota and Nebraska. Phase three of the project would involve expanding the pipeline south from Oklahoma to the Houston area.

Natural oil sands seepage into Alberta's Athabaca River

So right off the bat, this KeystoneXL pipeline expansion would be providing Americans with jobs and an important energy source from a politically stable ally in the region. Sounds like a win-win- doesn't it?

Well- not to the usual suspects. Interesting how last year, Cap & Trade co-author Rep Henry Waxman (D- CA30) was concerned about the possible environmental impact of the Keystone XL project but now the House Democrat is worried that the eeeeeeevil Koch Brothers- the de-facto progressive boogeyman since late 2010- might financially benefit from the pipeline's construction- because apparently we cannot have abundant oil from Canada if a single Republican donor stands to benefit from it [curious how they aren't quite as dilligent on legislative or policy decisions that would affect....say...Jeffery Immelt- NANESB!].

'Green' energy advocates often (and rightly) cite our growing dependence on an energy source that primarily originates from a decreasingly stable parts of the world. Yet whether it's hydrofracking in the Marcellus Shale, offshore oil drilling in the Gulf of Mexico or ANWAR, the same 'Green' energy advocates suddenly deem those energy sources off-limits.

Since the proposed KeystoneXL pipeline expansion crosses the US/Canada border, the final say in the matter is ultimately left up to the State Department, which is expected to make its final decision after a multi-agency review later on this year [A word of caution- leaving the matter up to the State Department could be a means for the White House to avoid making an unpopular political decision ahead of 2012- NANESB!]

Here's the thing that really bothers me- should they successfully derail the KeystoneXL project, it's not as though the oil sands will continue to sit there untapped. There is still the matter of growing demand from China. From the American perspective, one of the few things we have in our favor at the moment is that there's perhaps even more local opposition to the Northern Gateway pipeline project then there is the KeystoneXL. There is also concerns about tankers navigating the 55-mile inlet known as the Douglas Channel in order to get between Kitimat and the Pacific Ocean.

ExxonMobil Announces Significant Oil Find in Gulf of Mexico After Chaotic OPEC Meeting in Vienna

Oil giant ExxonMobil [NYSE- XOM] announced on Wednesday a major discovery in the Gulf of Mexico that could yield as much as 700 million barrels of oil.

Exxon began exploratory drilling at the Hadrian prospect in 2009. The company had finished two wells at the site, located about 250 miles off the Louisiana coast in 7,000 feet of water, and had a rig on location and an approved permit to drill a new well when operations were halted due to the temporary moratorium after the BP oil spill last year.

In March, federal regulators signed off on Exxon's revised permit to drill the new well in the Keathley Canyon area of the Gulf, the company's first approved under the new regulatory regime put in place after last year's spill. The new well extends about 23,000 feet below the sea surface, and the rig is continuing to drill deeper, said company spokesman Patrick McGinn.

"We estimate a recoverable resource of more than 700 million barrels of oil equivalent combined in our Keathley Canyon blocks," Steve Greenlee, president of ExxonMobil Exploration Company, said in a statement. "This is one of the largest discoveries in the Gulf of Mexico in the last decade. More than 85 percent of the resource is oil with additional upside potential."

The announcement came on the same day as a surprise announcement from the OPEC meetings in Vienna that the member states would leave production levels unchanged, causing a jump in oil prices.

OPEC officials said that because of a policy deadlock, the group will maintain present output ceilings with the option of meeting within the next three months to consider a hike.

"We are unable to reach consensus to ... raise our production," OPEC Secretary General Abdullah Al-Badri told reporters, in comments reflecting unusual tensions in the 12-nation Organization of the Petroleum Exporting Countries.

Saudi oil minister Ali Naimi called it "one of the worst meetings, we've ever had," while analysts covering OPEC for more than 20 years said they could not remember any other time that the normally closed group had admitted to such divisions in its ranks.

Some even saw the abortive meeting as a harbinger of demise for the organization, which produces more than a third of the world's petroleum.

"OPEC is ... on the point of break-up," said Marc Ostwald of Monument Securities. "A broader perspective is that the post World War II world order is fracturing in a spectacular fashion, be it the EU/Eurozone, the World Bank/IMF, (or) OPEC."

Other experts were less outspoken but agreed Wednesday's outcome would weaken the image of OPEC as a major regulator of oil markets.

The news caught markets by surprise, sending oil prices sharply higher. Benchmark crude for July delivery was up $1.25 to $100.34 per barrel in morning trading on the New York Mercantile Exchange after trading lower ahead of the OPEC meeting.

Saudi Arabia and other influential Gulf nations had pushed to increase production ceilings to calm markets and ease concerns that crude was overpriced for consumer nations struggling with their economies. Those opposed were led by Iran, the second-strongest producer within the Organization of the Petroleum Exporting Countries.

Oil minister Rafael Ramirez of Venezuela- like Iran, a price hawk - said there was a "very tight" discussion in OPEC, in comments to his nation's state media. Any production increase "could cause a collapse of our price," he added.

While the Saudis and the Iranians are frequently at loggerheads over pricing, past meetings normally fell in behind Saudi Arabia, which produces the lion's share of OPEC output. But this time, the Saudi-Iranian rivalry combined with major political and economic uncertainties to lead to deadlock.

Saudi Arabia, the United Arab Emirates, Kuwait, Algeria and Qatar were reportedly in favor of production increases while Iran, Venezuela, Angola, Ecuador and Iraq were opposed.

Kinetic Military Action Figure Update- Al Qaeda Looting Ghdaffy's Arsenals? Libyan Official Defects; Rebels, Qatar Bartering for Oil

LIBYA: NATO continued airstrikes against forced loyal to Libyan leader Mummar Ghdaffi outside the eastern oil city of Brega, striking a convoy that was heading towards rebel positions as well as armour and surface to air missiles in Ghdaffi's hometown of Sitre. The city of Brega has changed hands between rebels and Ghdaffi loyalists no less than three times in the last month.

The faction of the Libyan military loyal to Ghdaffi have also adapted the rebel's tactics of mounting machine guns, mortars and anti-aircraft guns on pickup or flatbed trucks. Not only does this give them a greater degree of mobility, but it also raises a problem for NATO pilots, as they would be much more difficult to distinguish from simlar rebel vehicles.

Amid reports that US and Egyptian special forces are covertly training rebel fighters in Eastern Libya [How covert is it if I'm reading about it on front the front pages of the International Business Times- I mean, really?- NANESB!] a senior Algerian security official has raised concerns that al-Qaeda has been exploiting the unrest in Libya to obtain weapons from Ghdaffy's arsenal for use elsewhere.

The senior official, speaking on condition of anonymity, said a convoy of eight Toyota pick-up trucks left eastern Libya, crossed into Chad and then Niger, and from there into northern Mali where in the past few days it delivered a cargo of weapons.

The weapons included Russian-made RPG-7 anti-tank rocket-propelled grenades, Kalashnikov heavy machine guns, Kalashnikov rifles, explosives and ammunition, he said.

He also said he had information that Al-Qaeda's north African wing, known as al-Qaeda in the Islamic Maghreb (AQIM) had acquired from Libya Russian-made shoulder-fired Strela surface-to-air missiles known by the NATO designation SAM-7.

"Several military barracks have been pillaged in this region (eastern Libya) with their arsenals and weapons stores and the elements of AQIM who were present could not have failed to profit from this opportunity" the official told Reuters "AQIM, which has maintained excellent relations with smugglers who used to cross Libya from all directions without the slightest difficulty, will probably give them the task of bringing it the weapons," said the official.

On top of that, a 2007 US raid against al Qaeda in Iraq yielded records on at least 600 foreign al Qaeda operatives in Iraq. Of those, an estimated 20% came from Libya- almost all of them from cities in the east that are now in rebel hands.

BBC Map showing first few days of NATO airstrikes

QATAR: The Liberian-flagged Suezmax tanker Equator arrived in the rebel-held eastern Libyan port of Marsa al Hariga on Tuesday, the first traffic since anti-Ghdaffy demonstrations began a few weeks ago.

The tanker's arrival comes shortly after the rebels announced a deal with the Persian Gulf emirate of Qatar where the oil would be marketed by Qatar in exchange for food, medicine (and the rebels hope weapons and ammunition as well). The 'barter' arrangement means that Qatar is able to circumvent international sanctions against Libya.

UNITED KINGDOM: Former Libyan Foreign minister Moussa Koussa flew to England from Tunisia last Thursday and announced his defection from the Ghdaffi regime.

As head of Libya external intelligence, Mr Koussa was an MI6 [British intelligence]asset for almost two decades. He was charged with conducting negotiations over Libya's giving up its weapons of mass destruction in 2003.

He was notably uncomfortable in making public statements on behalf of the regime in recent weeks. One Libyan official said that Mr Koussa had deliberated timed his statements to present a "rational" argument in the immediate aftermath of Col Muammar Gaddafi's rambling statements on national television.

With his arrival in the UK, Scottish prosecutors have sought to interview Koussa regarding the Libyan regime's role in the December 1988 bombing of Pan Am flight 103 over Lockerbie, Scotland that killed 270 people. At the time, Khoussa was head of Libya's Bureau for External Security (the Mathaba) which was implicated in the Lockerbie bombing as well as a 1986 bombing attack on a Berlin disco that killed 3 (including two American soldiers) and injured more than 200. Aside from the terrorist attacks against foreign interests, operatives from the Mathaba (often with Libyan diplomatic credentials) would also harass and threaten exiled Libyan opposition figures.

Since the uprising began, Ghdaffi has lost his interior minster and justice minister to the side of the rebels.