Officials from Sudan and South Sudan are set to meet in the Ethiopian capital on Thursday in a bid by the African Union (AU) to end ongoing clashes and prevent an all-out war between the two neighbours.The pan-African body on Wednesday said it was deeply concerned by an "escalating security situation" on the border between Sudan and South Sudan, and called for troops to pull back 10km on either side of the border.Ties between the two neighbours had been tense ever since South Sudan was carved out of Sudan as an independent country last year.The current dispute is centred around the sharing of oil wealth, and both countries blame each other for the recent clashes around the town of Heglig.DialogueFollowing AU's intervention, however, both sides said they were ready to engage in talks.Rahamatalla Mohamed Osman, Sudan's under-secretary of foreign affairs, said he was in Addis Ababa "to represent my country in the negotiations... with regards to security along the border". Osman said Khartoum did not want a war with the South, but warned "if they want to accelerate, we will defend ourselves."South Sudan's top negotiator Pagan Amum also voiced optimism over the talks."What we expect to achieve is the cessation of hostilities," Amum said to the AFP news agency in a telephone interview from the South Sudanese capital, Juba. "We will stop the fighting that is there, and ensure that this does not erupt into war between the two countries."Amum urged both sides to "rescue the positive spirit" of earlier talks, and said he remained confident fighting would stop after the meeting.A Sudanese army spokesman told Al Jazeera on Wednesday that the situation was calm on the front where fighting had been occurring, and a Sudanese foreign ministry spokesman said that the country would not bomb South Sudanese positions."We are not going to make any sort of shelling or any sort of bombing in South Sudanese territory," ministry spokesman Al-Obeid Meruh told the AFP news agency. "We are not for the war now and we are not going to widen the war area."Gideon Gatpan, information minister for the South's Unity state, said there was bombing by Sudan overnight in Panakwach, 35 kilometres from Bentiu, state capital of the oil-rich area.Colonel Phillip Aguer, a South Sudanese military spokesman, said that the country's troops had "disengaged and withdrawn" from the contested area.South Sudan alleges that its northern neighbour began bombing its territory on Monday, and then launched a ground incursion. The north, however, says that Southern troops invaded Sudan before being pushed back.Meruh said the army cleared all Sudanese territory of Southern troops by about 17:00 GMT on Tuesday and if any shelling had occurred it was related to those final clashes.