Somaliland:Potential oil rush in Somaliland

[Saalax]

 

 

Somaliland is expanding its oil exploration. Earlier this year, it and DNO International, a Norwegian oil and gas firm,signed a production sharing contract – a contract where a firm explores, recoups costs and then splits further profits with the government.

 

Previous exploration concessions have also been given to firms such as Genel Energy, an Anglo-Turkish energy firm; Ophir Energy, a London-listed oil and gas explorer with African interests; and Jacka Resources, an Australian oil and gas exploration company.

 

The exploration could lead to further business opportunities as oil and gas companies build the infrastructure required. And of course the oil is a lucrative opportunity in its own right.

 

It is still early in the exploration process but the prospects look good, says Hajji Mohamed Aw ali, a Somaliland businessman.

 

If exploration was to prove a success, the oil firms would require significant infrastructure support to be built. For example this would include items such as roads, pipelines and facilities.

 

“Already there are nearly 800 new pickup trucks and Toyota Land Cruisers as these companies make their surveys. They told me that agencies facilitate this as new company cars. It’s the first time that this number of new Land Cruisers has arrived in Somaliland at one time,” he says.

 

The Somaliland exploration is part of Genel’s first foray into Africa, says Aw ali. Somaliland is important to the firm. Genel has said that it would be investing almost £20m ($30m) next year alone, he adds.

 

“I spoke to some people from the Ministry of Energy. They told me that the group’s delegation, headed by the former BP boss Tony Hayward (and now Genel executive), will be visiting the country on November 6,” Aw ali says.

 

The oil firms seem to be optimistic about Somaliland’s oil prospects. “It’s interesting and exciting geology,” says a Genel spokeman. “It’s the same rocks and geology as Yemen, which has been a good oil province.”

 

The firm is targeting over 2bn barrels of oil in the region. “Genel took the opportunity because of encouraging indications including onshore oil seeps and existing geological data showing favorable conditions for hydrocarbons to have accumulated in numerous large tilted fault blocks and sub-basins,” the firm says.

 

However, there is significant work still to be done. Genel is in the process of completing seismic and gravity surveys to determine where to drill. Drilling is expected to start at some point next year but the territory to explore is enourmous. Genel’s acerage is larger than all of Kurdistan, where the firm also has interests, the spokesman adds.

 

“We’re very positive about it, although it is still a bit premature to be talking about supporting infrastructure,” he says.

 

Ophir Energy agrees with the positive assessment and the need to not rush. The political situation is improving, says a spokesman. Regional settlement is a possibility which would increase its attractiveness.

 

Somaliland is also a largely empty country with a good coastline so it would not be difficult for firms to first truck oil to the shore for export and then build a pipeline. However, the firm has not publically expressed any plans for its Somaliland in its drilling schedule and having raised funds for drilling there is a limit to what can be said, the spokesman adds.

 

But for firms involved in industries that could provide support, it may be time to think about a Somaliland operation.

 

Next steps and more information

 

1. DNO operations

 

2. Genel operations

 

3. Ophir operations

 

4 Jacka operations

 

 

http://pathfinderbuzz.com/potential-oil-rush-in-somaliland/

 

 

http://somalilandpress.com/somalilandpotential-oil-rush-in-somaliland-43061

[Xaaji Xunjuf]

I am sure there is oil but Somaliland should be careful about what kind of deals it reaches with oil companies. Oil also will help with Somaliland quest for recognition. Do we have sources that indicate what percentage the oil companies will take and what percentage Somaliland.

[Cambuulo iyo bun]

oil fever season

[Mad_Mullah]

It won't help with recognition unless it's some mad quantity of oil like in KSA, Iraqi Kurdistan also has a LOT of oil.

[Xaaji Xunjuf]

If there is even the size of Yemen of oil it will help, there is always interests for oil when it comes to western powers.