Nairobi  - The Sudanese government and former rebels from the south have agreed to use international arbiters to resolve a dispute over the oil-rich town of Abyei, which observers fear could reignite a civil war.

Heavy fighting broke out in Abyei between government forces from the Muslim-majority north and the southern Sudan People's Liberation Army in mid-May, forcing more than 50,000 civilians to flee.

The conflict appeared to be at risk of escalating, but the BBC reported that negotiations have led to an agreement on an interim administration for the Abyei region.

International arbiters are also to be used to set the region's final borders, joint army and police forces are to be deployed in the town and measures are to be taken to bring the displaced home, the BBC said.

Tensions have remained high in the Abyei area since the 2005 Comprehensive Peace Agreement ended a decades-long conflict that claimed millions of lives.

Abyei sits near the disputed border between the northern and majority-Christian southern regions and has significant oil deposits.

Under the 2005 peace deal, the autonomous southern Sudan is to run a referendum in 2011 to decide whether is should claim complete independence. (dpa)