Sudanese President Omar Bashir and his South Sudan counterpart Salva Kiir will next week hold talks on oil production to rehabilitate their struggling economies.

A statement from the Inter-Governmental Authority on Development (Igad) said the two leaders were expected to meet in the Sudanese capital, Khartoum.

“The meeting between the two leaders will discuss measures to be taken to rehabilitate the South Sudanese economy through bilateral cooperation between the Republic of South Sudan and the Republic of Sudan,” the Igad statement said.

President Kiir is also scheduled to attend a new round of talks with rebel leader Riek Machar in Khartoum the same week.

Khartoum and Juba recently agreed to repair the oil infrastructure in Panthou, at their common border.

South Sudan Information minister Michael Makuei said the Panthou oil facilities were damaged by the 2012 fighting between the Juba and Khartoum armies.

South Sudan's President Salva Kiir. FILE | NATION MEDIA GROUP

Mr Makuei said the oil wells would be repaired within three months and that production would then commence immediately.

The two countries have also agreed to form a joint protection force to deter rebels infiltration that could disrupt the oil production.

South Sudan attained independence from Sudan in 2011, taking with it most of the oil resources, occasioning a serious dent in the northern economy.

However, the new state descended into a bloody internal war in December 2013, that has seen its economy on its knees.

The South Sudan economy is heavily dependent on oil, but fighting between rebels and government forces has caused a major decline in production.

The South Sudanese leaders have also been accused of using the oil money to fuel the civil strife.