They were on the brink of war in April, but now the leaders of Sudan and South Sudan have held face-to-face talks in Ethiopia.
A UN deadline for a peace agreement has been extended. The two sides will meet for more talks on Monday.
At a hastily-convened briefing, a spokesman for the Sudanese delegation said most of the economic issues are resolved and the main stumbling block remaining is the security issue.
South Sudan seceded from the North in July 2011 after decades of civil war.
But a long list of issues were left unresolved including border demarcation, oil fees and mutual allegations of rebel support.
The armies of both nations fought for weeks in April along the unmarked and disputed border after a row escalated over how much South Sudan should pay to use its neighbour’s oil pipelines.