April 24, 2006

US envoy discusses security, oil with Chad leader

By Daniel Flynn

N'DJAMENA (Reuters) - A top U.S. envoy met Chad's President
Idriss Deby on Monday to discuss insecurity in the central
African country but appeared to make no immediate headway in a
dispute that threatens to halt its oil output.

U.S. Deputy Assistant Secretary of State for African
Affairs, Donald Yamamoto, met with Deby a week and a half after
rebels Chad says are backed by Sudan attacked the capital in
their boldest attempt yet to end his nearly 16-year rule.

Chad has said it will stop its oil production at the end of
April unless the World Bank unblocks frozen oil production
royalties or an Exxon Mobil-led consortium in the country pays
at least $100 million to circumvent the freeze.

The World Bank suspended loans to Chad in January and froze
an escrow account containing Chadian oil revenues because it
said the government had broken an agreement to ensure oil
profits were saved for a long-term plan to fight poverty.

Deby has said Chad needs quicker access to the revenues --
some of which were meant to be saved for future generations
under the original World Bank-backed deal -- to help bolster
national security against the rebel attacks.

Sudan has denied backing the insurgents.

"The talks broached a wide range of subjects. They were
open and very positive," a diplomat said, asking not to be

The United States, along with former colonial power France,
has expressed concern about possible Sudanese involvement in
the rebel operations against Deby, who has broken diplomatic
ties with Khartoum and closed the border.

Washington says increased tension between Chad and Sudan
could hurt hundreds of thousands of refugees fleeing political
and ethnic violence in Sudan's western Darfur region.

Yamamoto was due to meet officials from the Exxon Mobil-led
oil consortium on Tuesday.

Earlier this month, he had asked the Chad government to
postpone a previous deadline for halting oil output to allow
time for talks on the ongoing dispute.

U.S. officials have shied away from talking about mediation
in the disagreement, instead saying Washington would act as an
"honest broker" to try to foster better understanding between
N'Djamena and the World Bank.

"It is an information mission. He has come to inform
himself on the current situation in Chad," the country's
foreign minister, Ahmat Allam-Mi, told Reuters.

"We are going to consult and reflect on questions of common
interest. But Yamamoto is not in charge of the mediation on the
question of oil," he said, adding the trip had been planned for
some time.

Chad produces some 160,000-170,000 barrels of oil per day.