Sudan very optimistic about border agreement with South Sudan - Reuters

Sudan's Second Vice President al-Haj Adam Youssef said both sides did not need to solve all outstanding conflicts to reach such an agreement.

"We are very optimistic about the (border) security issue," he told reporters on Saturday.

His comments were the strongest indication yet that the border security issue between the two hostile African neighbors can be solved.

Oil is essential to both countries and they have reached an agreement about how much landlocked South Sudan will have to pay to export its oil through northern pipelines, ending a dispute that saw the South shut down its entire output in January.

But before exports can resume Sudan wants a security agreement for the 1,800 kilometer (1,200 mile) long border, much of which is disputed.

Border fighting brought the two countries close to another war in April. It was worst violence since South Sudan became independent a year ago under a peace agreement to end a long-running civil war with the North.

Youssef said the neighbors could finalize some of the most difficult issues left over from southern secession - such as the fate of the disputed border region of Abyei - after agreeing on a border security deal.

A buffer zone would be set up once the border had been marked.

"We think it is important to secure the border between the two countries so we don't return to war another time," he said.

Sudan accuses Juba of supporting rebels of the SPLM-North in the border states of South Kordofan and Blue Nile, a claim Western diplomats find credible despite denials from Juba.

Juba, in turn, accuses Khartoum of frequently bombing its territory, a claim denied by Sudan.

At the end of this month, Sudan and South Sudan are due to resume talks sponsored by the African Union to solve the border security and other issues. Previous attempts to set up a demilitarized buffer zone along the border have failed.

South Sudan has said it wants to resume oil production next month but would need a year to reach its former output of 350,000 barrels day after all its wells were turned off in January.

(Reporting by Ulf Laessing and Khalid Abdelaziz. Editing by Christopher Wilson)