The deal was signed late Sunday with the Sudanese White Nile Petroleum company -- a consortium of Malaysian state oil firm Petronas, which owns 68 percent, India's state-run Oil and Natural Gas Corp, which has a 24 percent stake and Sudan's state oil company Sudapet with 7 percent.

The remaining one percent is divided between the three companies, an oil ministry official said.

It said the reserves of the Thar Jath oil fields, in Block 5a in the southern Unity state, were estimated at a minimum of 250 million barrels. White Nile Petroleum is expected to dig 45 wells in the coming year, it added.

Sudan's main oil fields are in the south, and disputes over oil fuelled a civil war there for more than two decades, claiming 2 million lives mostly from hunger and disease.

A peace deal signed in January ended Africa's longest civil war and has revived interest in Sudan's potential oil reserves.

The deal states both sides will respect any oil contract signed before the date of the peace deal -- January 9, 2005 -- and any deals after a new government of unity is formed will be decided by a joint petroleum commission from the national energy and mining ministry.

But an official from the former southern rebel group the Sudan People's Liberation Army (SPLA) has said it has signed a deal with a London-listed company called White Nile, giving it part of block B in SPLA-controlled areas.

The news caused consternation as French oil giant Total signed a deal with Sudan in 1980 for the whole of block B, and the deal was renewed in December.

Total and the government both say they are confident of the validity of the deal.

More senior SPLA officials have played down the report of the deal with British White Nile, which analysts say indicates divisions within the former rebels, who are due to join the government in the coming weeks after a two-month delay.