Somaliland takes steps to attract oil companies

[Xaaji Xunjuf]

Somaliland takes steps to attract oil companies

August 27th, 2011

 

 

Breakaway state tries to surmount problems bringing in E&P business as it petitions UN for recognition/

 

SOMALILAND Minister for Foreign Affairs & International Co-operation Mohamed Omar this week convened a meeting with London investment bank Libertas to discuss how to attract oil companies back to the breakaway republic in the Horn of Africa.

26 August 2011 01:20 GMT

Based in the capital Hargeisa, the government of Somaliland has pegged energy “as one of the core four planks of foreign policy and is looking to engage the African Union, European Union and United Nations Security Council to support and recognise its efforts.

The difficulties encountered in the insurance sector by Somaliland as an unrecognised state in getting oil companies to pursue practical exploration and production programmes have to be addressed, Omar told Upstream.

Whether Hargeisa and its neighbouring semi-autonomous Somali province of Puntland based in Garowe could suspend their territorial differences to aid joint pursuit of oil and gas explor-ation and production was another urgent question, as were issues of force majeure advanced by the majors over a decade ago when exploration was suspended, said Omar.

Libertas, which acts as a nominated adviser for energy and natural resources-focused AIM-listed companies, this week launched a roadshow to attract investors to suitors already eyeing Somaliland oil and gas opportunities.

The initial response to Libertas’ presentations was described by one financier directly involved in the process as “very positive” and a second round of meetings are scheduled to take place in London after 30 August.

Omar noted that nearby South Sudan last month became the 54th member of the African Union after a six-year probation and 22 years of civil war.

Hargeisa last month attended South Sudan’s independence celebrations in Juba and will formally seek recognition as a sovereign state in the United Nations Security Council — “but we have no intention of making trouble”, said Omar.

•• IN ADDITION to Somali acreage licensed in Somaliland and neighbouring Puntland, the Ethiopian government has subdivided the Somali O'gaden (Region V) into 21 blocks, including the Calub (Jeexdin) and Hilala (Elele) gas fields.

Following the exit of Petronas after Somali guerrillas the O'gaden National Liberation Front (ONLF) threatened the lives of operatives, Addis Ababa last month assigned title on several blocks to Hong Kong-based PetroTrans.

Beating competition from the National Oil Company of Ethiopia, Cobramar of Seychelles and fellow Hong Kong explorer SouthWest Energy, which already operates in the region, PetroTrans plans to invest heavily in blocks 3, 4, 11, 12, 15, 16, 17 and 20.

Petronas was poised to invest in a gas treatment plant and gas pipeline to the nearby port of Djibouti but PetroTrans aims to develop the gas fields in three years and build gas transport and processing infrastructure within that period — gas pipelines are planned to cross the O'gadendesert for export at the Somaliland port of Berbera.