Published On: Mon, May 21st, 2012

Somali government ready to fight for oil finds

MOGADISHU — Somalia’s embattled central government will not argue with semi-autonomous Puntland over potential oil revenues for fear of scuttling a fragile peace process, but a top official said on Monday the law made clear control lay with Mogadishu.

Canadian firm Horn Petroleum, majority-owned by Vancouver-listed Africa Oil Corp., and its exploration partners started drilling in March in Puntland’s Dharoor Block but have yet to announce any proven reserves.

Africa Oil and joint venture partners Range Resource Ltd. (RRS.AX) and Lion Energy entered into production-sharing agreements for the Dharoor Valley Exploration Area and the Nugaal Valley Exploration Area directly with Puntland, bypassing Mogadishu which is grappling with an Islamist insurgency.

“Our policy is to let the oil come first rather than now going to Puntland and making our point,” Deputy Minister of Energy Abdullahi Dool told Reuters.

“Because of the situation between different regions, we don’t want to push anyone to the wall. We don’t want to make too many Somaliland situations where regions want to break away,” he said in an interview.

Dool was referring to the northern breakaway enclave which declared independence in 1991 but is not internationally recognized.

“First of all let there be oil. You can’t fight when everything is underground,” said the minister, whose portfolio also includes water, petroleum and mineral resources.

Somalia’s interim federal government is tasked with adopting a new constitution by August, aimed in part at redefining the relationship between Mogadishu and the regions and ending a two-decade cycle of violence.

The Western-backed government has been fighting al Shabaab militants who still control large swathes of the country and want to impose Sharia law.

Puntland has objected to the first draft of the constitution, saying it left too much power with Mogadishu.

WHO GETS WHAT?

Dool said the country’s petroleum law made clear the government should dictate license agreements with foreign investors, while ensuring the regions get a cut.

“It has very clear guidelines on the rules on who gets what and what will be the way to resolve (disputes) between central government and (the) regions,” he said.

“The petroleum law makes it very clear it is the central government who has absolute control but there is a role for … local government or regions.”

Muddying the waters further is the fact that Italian oil explorer Eni may still have legal rights to the Dharoor block.

Eni was issued a licence by the Somali government in the 1980s to explore Dharoor. It claimed force majeure as the country plunged into chaos, with warlords and then Islamist militants filling the power vacuum.

“We abide by every international agreement the governments before us have committed to,” said Dool.

Dool said the Somali government had not approached the Italian oil giant on the issue as “our first priority is to pacify the country”.

(Editing by Yara Bayoumy and Jason Neely)

Reuters

May 21, 2012

  • Kayse

    Resources in Somalia belong to all Somalia and few opportunists running small enclaves should not loot the country's resources and foreign investors should not take advantage of Somalia's current situation.

    Somalia is slowly recovering and all those illegally involved with Puntland, Somaliland region and others are strongly advised to review their practices because once you have done all the hard work, you will not be able to sell it nor get any returns.

    You are dealing with crooks like Abdirahman Faroole who has no clue about international law because he thinks if oil is discovered he would be able to export it via Bosasso.

    This of course is not true and if Eni which holds the licence decides to block it, no one will buy the oil except Somali pirate boats operating in that region.

    Investors and companies must withdraw all illegal activities from all Somali regions unless they have license from the central government which is internationally recognized.

    This is a tax evasion and stealing Somalia's resources without consent from its government and lawmakers. Furthermore you are undermining its legitimacy and sovereignty.

    Explorations must all be suspended or face international criminal court and heavy law suits.

    • Abdiwahab

      Somaliland is a separate country fool

      • burci

        @abdiwahab.
        This debate it’s too complicate for you we are talking about in general somalia her future,so pls go back your small barricade Enclosure.

        • wiil yaaban

          kkkkkkkkkkk well said burci only inteligent minds please separate country kulyeh nice when?
          there is no recognition yet but i will be so happy if somaliland left us we have already enough problem in somalia

    • hassan ali

      @kayse.
      Your view is striaght forward not zigzagging & you got credit for That,put in These situation we should Think different ways to solve it,somali problem started poverty & ruling military regime,when people have jops,free medicare,education They unlikely confront The Authority look These cities hargiesa-bosaso unemployment very high young people rooming around streets by The Thousands.

      I believe let These two regions Puntland+S/land keep drilling,if There’s oil found price water house cooper Accountant & world bank took over The finance area revenue generated from This oil,let Them put aside percentage for These two regions in development area such as roads-schools-hospitals-manufacturing sector-regional goverment employee & give The rest to central goverment in This way could be Avioded corruption & conflict between central goverm and regional addministrations.

    • xaange

      The era of consolidating power in Mogadishu is over. The minister has a right to express his opinion, but Puntland does not recognize the law he is referring to. Puntland president made it clear that any potential oil proceeds will be shared with all Somalis. However, Puntland will dictate how it manages its resources. We will not accept a strong central Somali government that consolidates its power in Mogadishu

    • mohamed cheers

      Kayse with the exception of Somaliland all inclusive Somalia roadmap 1+2 conventional treaty
      agreement signatories should abide by your well said comments. I fully support your brilliant ideas that the Central Govt. Mogadiscio HQ should be real authority to call the shots on the issues of petroleum
      explorations throughout the signatories regions of Somalia. Somaliland's a different ball game and
      should be excluded as a seperate dejure Sovereignty authority.
      Cheers.

  • An Investor

    Perhaps "the central government which is internationally recognized" could create some law and order in that country, and stop exporting all its problems to nortern Europe and other countries.

  • cimraan

    what they will fight with Uganda’s troupes.By the way Nugaal valley is in Somaliland. Go figure. Amazing how individuals think.

    • garandi

      do mean troops? Nugaal is pure majeerteen land whether British occupied or Italian occupied ( i know that is what you mean) so there is no point somaliland claiming Nugaal live and let live i would recommend.

      • khaatumo citizen

        lool nugal is not pure mj, get ur facts right.. but i agree there no point sland claiming it, they cant even claim half of togdheer..

        • mohamed cheers

          Khaatumo which gender are you..he or she..man or woman? You smell she odours to me?
          Cheers.

      • cimraan

        you got the idea. Nugaal is Somaliland country.

      • mohamed cheers

        Not to worry, these issues would be sorted out between Somaliland Hargeisa and Somalia Mogadiscio by their relative Govt Authorities.
        Cheers.

    • khaatumo citizen

      loool just coz theres few dabodhilif in lascaonod who threatened da old Diabetic guy everyday if doesnt do what they want that gona join khaatumo therefore cant get pass wacadari 5kg from lasconad and u think u have a whole access to nugaal or sool please spare me on that..

  • Puntlander

    Dool he is stupid, we will figth for our resourses and never allow central goverment to get control over,and other hand he spoke what he called agrement for an italian compny in 80 ths we never heats that and its sobotoge to stop puntlands own strategy,i think he dreaming.

    • sade boy

      "puntlander

      tell mr Dool first get all the daarood houses being urinated by the hyenas back before you dream of recources in the hear of daarod land believe me cabudwaaq will be in the side of harti and tanade if the hayenas ask for more than 5% of puntland oil

  • Ayanle

    @puntlander stop talking nonsense. If you consider yourself a state of somalia you will Abide to the law.
    We need money to pay for the reconstruction and the réhabilitation of the militia in an national Army !
    Sharing a smaller pie is better than none !

  • Ayanle

    We need Farmaajo for president ! An honest Politician to manage that Halal money !

  • Allemagan

    @Puntlander

    Farole and his pirates have become the biggest obstacle to restoration of peace and tranquillity to Somalia. While the pirates have become the scourge of the Somali coast, Farole has become the Achilles hill of finding any solution for the Somali problem. Farole brings down governments of Somalia prematurely by insisting positions such as the prime minster of the country can only come from his Pirateland or by arguing about an oil that does not exist or 4.5 of something.

    Farole insists that any meeting that he will have with the Somali government must take place in Addis Ababa only and only under the auspices and blessings of Meles Zenawi. Can Puntlander explain why is that? People like you how sing different tune about tribal resources always also insist that Mogadishu does not belong to any particular tribe. Go figure. You can't have it both ways but good logic and reasoning will easily escape a pirate.

    • osman5

      Good point. I couldn't say it any better.

      Osman Qaal

    • mohamed cheers

      Now you are singing my song buddy keep it up. The two Somaliland Somalia Sovereignty States.
      Just only the two dejure entities who voluntarily without conditions or under pressure obligations
      become parterners into the erstwhile Union which failed to continue. The same two Hargeisa and
      Mogadiscio should be the onlt powers to deal with the problems of Somaliland and Somalia.
      Cheers.

      • amal

        Allemagan,
        You know a lot about Pirateland. Allowing them to drill the oil without central strong gov means looted Somali resources as they will only settle with cheap deals just to satisfy their greedy mouths. Resources should only be managed by central govs. You don't see garhajis block being claimed by a clan.

        • amal

          And that is only IF there is any oil there.

  • Allemagan

    People like you whow sing different tune – that is

  • Allemagan

    Correction: People like you who sing different tune

  • ComeAgain

    LMaooooooooo you know these guys are crooks because they want to make money off of regions they dont even control! Wtf?

    Another reason why Somaliland should stay clear of Somalia and I hope puntaland has the good sense to do the same!

  • khaatumo cizen

    oil in somalia belongs to all somalis whather its in Bari, bakool, banadir nugal, sool, sanag, saxil ,Zailac or anywhere else. .. we should all understand that

    • mohamed cheers

      Granted and you damn right about that but right now all these you mentioned are fighting each other into
      small enclaves of each clan. Don't you see the only two major powers are Hargeisa and Mogadiscio?
      The rest are all inclusive biproducts of these two Capitals.
      Cheers.

  • Kayse

    Cry all you want. The Somali government does not need an army or navy to blockade the oil leaving the country illegally. All it needs to do is go to the United Nation assembly and pass the law that Somalia oil should not be bought or sold without its license and the original oil deals with the big oil companies which have the best lawyers and $$$$ stand. These little groups trying to take advantage of the situation will be devastated.

    I suggest before they wait they (Somali government) contact Eni, Chevron and the other big U.S. firms that had the license. Together put a new Oil bill together and block all illegal sales of Somali oil and gas.

    Puntland pirates think, Somalia needs troops to disperse them, they have no clue how the modern world operates.

    Basically like Sierra Leone diamonds, Somali oil will be blockaded, I hope the title "Conflict Oil" is adopted soon than later.

    • xuux

      s tell us if somaliland tries to export oil can somalia do the same? explain me the hypocrisy

    • mohamed cheers

      Kayse with you on this go run for it you are singing my song of Hargeisa Mogadiscio capitals
      should work together and resolve these Force Majeure of the 1980s Oil Companies. But how
      strong Force Majeure abandonments, maybe these agreements are automatic repudiated and
      will have no binding legit bearings on the current situations of Somalia and Somaliland or maybe
      Somaliland is off the hook and will have a clean record? These issues should be clearly defined
      and dealt with asap.
      Cheers.

  • osman5

    The outgoing TFG or the next administration doesn't have to do any thing dramatic to stop the oil piracy that's occurring in one of the Somalia regions.

    Puntland will auction everything it can including oil to get instant cash flow. Somalia indeed has a jurisdiction over all Somalia regions. So, if oil is found in Puntland, the pirates would have hell of a difficult time of selling it in the regular oil market. They might try it in the black market oil, which pretty much exists but Somalia has to be a couple steps ahead of them

    As the title of this article suggested Somalia will fight for it's cut with help of the big oil companies that rightfully had oil concessions in Puntland. the article has also clarified that Somaliland had already declared it's Independence in 1993 in which explicitly reconfirming that Somalia has no jurisdictions over Somaliland's oil pursues.

    I can only assume why Somaliland was mentioned in this was that Puntland will surely bring up Somaliland's current oil exploration during it's self-defense argument.

    Osman Qaal

    • saalim

      Osman5.

      look mate debate like civilaize person always one someone mension Puntland in any artical you get Analytic shock.also selling lies to your little mentally confuse Audiece suffering identity fake crisis,s/land or Puntland regions both have to get throught approval from central goverment if found oil.s/land is somali region whether putting your head in sand or fib flopping back & forth.

      in This forum There are Three types of debaters.
      1)striaghtforward debaters make sence when They talk not a baised.

      2)delusion debaters have no clue what he/she talking about lock it in The past with no hope in The future.

      3)childish debaters.

      so you will fid category 2 & 3.

      • saalim

        correction flib flopping.

      • osman5

        Dear saalim,
        Debates usually based on two elements; facts and fictions, I'd prefer facts over fictions. You can place my comments any category of your choice, It doesn't matter to me..

        Osman Qaal

    • saalim

      Osman5.
      people should be able to proof whether Their debate is fiction or fact,That is The whole idea of debating in This case we see none.

  • Xarago

    @ Osman when SL became independent walaal stop day dreaming Somalia is one country recognized by international community so stop been fool OK. The whole wold knows one country that is Somalia, North Somalia have their own region and administration but they are not a country or sovereign, they are part of Republic Somalia and always will be like that viva jamhuuriyadda soomaaliya.

  • osman5

    Dear Xarago,
    That's my observation on the article, So, don't shoot the messenger..
    Again, Somalia doesn't have a beef with Somaliland's oil pursues. You may want spend sometime on figuring it out as to why not.

    Osman Qaal

  • Kayse

    Somaliland is actually in far worse situation than the Puntland region because Somaliland wants to break away thus investors know their findings can not be sold.

    The only way Somaliland could export oil is if a powerful nation like the United Kingdom, USA or China declares they recognize the break away enclave and decide to pump its oil. Even that will not be profitable because the State that just gave them the recognition went against all international bodies and laws and will justify that they have control of the majority stalk.

    In another words, high risk = high gains.

    As for Puntland, Mogadishu will just visit the United Nation and report that Western firms are doing illegal business with its states.

    Would the U.S. like if Iran was doing business with the state of Texas?

    Also everyone in Puntland and Somaliland is waiting for the oil to be found then thats when all clans will fight over. Like the minister said "first let the be oil" then thats when the real conflict surfaces.

    These small firms are just trying to risk it all by doing business in where big firms can't go because big firms have big cashflow and big "Corporate responsibilities" unlike this minor explorers who have a net capital of no more than $20million.

    Somaliland nor Puntland region would be able to sell any oil findings without the consent of Somali government and the parliament of the people.

    Hefty law suits, human right abuses, negligence, tax evasion, environmental damages, destroy of livelihood, destabilization will be just few of the many things that they could face in local and international courts.

    The Somali government along with its foreign troops might be given the green light to destroy all their equipment and close all exploring sites.

    • mohamed cheers

      Kayse..Listen carefully..how many times the legit de jure Somaliland with clearly defined International
      demarcation borders based on the post Independence of June 26 1960 were put through your
      dried skin dumb scapegoat…forget the words such as..secession, breakaway, de facto etc etc.
      You all damn well know that Somaliland doesn't fall under these cheap gambling dices.
      Somaliland falls fully under Sovereignty State of her own by virtue and not by breakaway.
      The only obstacle facing Somaliland is some kind of unfairly justified embargo of some sort,
      that's to say certain political impediment by the IC key Govts who maybe having certain hidden
      agendas. However, to overcome such impediments would need a smart Somaliland Govt to
      thunderball through strong diplomatic pressures to fight out the unnecessary embargo ban.
      Cheers.

  • cimraan

    I like the name of NORTHERN SOMALIA. Show you’re a Somalilander at heart.Northern Somali Republic. Sounds good to me. I don

    ‘t know people where you get your information. The UN the Italians, oil companies…. The last I checked this world is an oil hungry place. Oil is a precious commodity. There will be plenty of takers. And my prediction is as soon as Faroole hits some crude he will declare independence. He is not the sharing type. HECK HIS whole tribe is not the sharing type. They threw the rest of the darood clans who helped build punt-land to the wolves. So just wait and see. Before it was Darood this and Darood that and as soon as they had a little backbone boom it is all mine.

    I am the the Bose and yes you are my servant. It is all a Dalanteed.

  • Xuseen

    I cannot understand why the TFG is sitting back and watching all this unfold without yet setting clear regulations and guidelines to be followed in order for this deal to be finalized. They need to be proactive and lay the law down before its too late! …

    In order to make sure ( Insha'Allah) this turns out to be a smooth and safe operation, any oil drilling contract should involve all departments of government. We need to get it together before this black gold starts spitting out … or else North Somalia will become another Niger Delta.

  • puntland lover

    is our oil puntland

    • mohamed cheers

      How Somaliland OIL could be Puntland OIL? Get the hell out of here.
      Cheers.

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