HIGHLIGHTS: Agreement Covers Two Contentious Issues: State Versus Religion & Self-determination (for the south)||No Ceasefire Until All Issues Are Resolved||Successful Peace Talks Could Help Turn Sudan into a Major Oil Exporter|| STORY: Sudan's warring factions said on Saturday they had made a major breakthrough in talks to resolve the 19-year-old conflict and hoped to sign a comprehensive peace deal after further talks in August. Following five weeks of negotiations in the Kenyan town of Machakos, delegates from the government of Sudan and the rebel Sudanese People's Liberation Movement (SPLM) said they had agreed on the two most contentious issues in the war. (Read photo caption)

"We have agreed on a structure which resolves the basic question of state versus religion and self-determination (for the south)," head of the government delegation Ghazi Salah al-Din told reporters.

"These were the two most difficult questions which we had."

SPLM spokesman Samson Kwaje said the rebels would not consider a cease-fire until all outstanding issues were resolved. But both men were hopeful agreement could be reached at the next round of talks, scheduled for mid-August.

Analysts say there is a deep distrust between the two sides and many deals signed in the past have been violated. The agreements reached on Saturday remain fairly vague and details must be settled before they can be implemented.
But renewed international interest in recent months -- most significantly from the United States -- has re-stoked the desire to end the war and observers welcomed the fact that the warring sides appeared to have found some common ground.

"This is a major break with the past," regional political analyst Moustafa Hassouna said. "I think there has been a creation of a middle ground...that has yielded concessions that have never been verbalized before."

In Bern in Switzerland, former Sen. John Danforth, the special U.S. envoy to wartorn Sudan, said Thursday said that successful peace talks could help turn the African nation from a conflict zone into a major oil exporter. (Read more on this on topic at [IN THE PRESS] channel)

PHOTO CAPTION

President Daniel Arap Moi of Kenya (C) looks on as envoys from Sudan's warring factions shake hands in Nairobi, July 20,2002. Commander Salva Kiir (R) from the rebel Sudan People's Liberation Movement (SPLM) and Sudan's presidential peace adviser Ghazi Salah al-Din (L) said they had made a major breakthrough in talks to resolve the 19-year-old conflict and hoped to sign a comprehensive peace deal after further talks in August this year. (Antony Njuguna/Reuters)