REUTERS
5:27 a.m. February 22, 2007
NAIROBI –
Gunmen ambush troops as insurgents fire rockets at military
bases and pirates prowl the turquoise Indian Ocean shipping
lanes offshore.
Somalia may be seem an
unlikely prospect for investors seeking untapped oil and gas
fields, but that could be about to change as the majors turn
their gaze off the beaten track.
Driven by record profits, a race with
hungry Asian rivals and fears of growing energy nationalism
in South America and Russia, interest in eastern Africa has
never been higher.
“Africa across the board
has seen a substantial uptake in acreage in recent years by
all sizes of companies from the majors to mega-majors,
independents and minnows,” said Duncan Clarke, chairman and
chief executive officer of international energy consultants
Global Pacific & Partners.
“Quite a few significant
players have moved into position.”
Big Western companies
including ConocoPhillips, Chevron and Total held Somali
exploration concessions before the country slid into civil
war in 1991.
A World Bank and U.N.
survey that year of eight northeastern African countries'
petroleum potential ranked Somalia second only to Sudan as
the top prospective commercial producer.
Northern Somalia lay within
a regional oil window reaching south across the Gulf of
Aden, the geologists said.
Encouraged by that,
explorers hoped to find an extension of the crude-bearing
deposits that hold nearly 4 billion barrels under Yemen in
the Marib-Hajar and Say'un-Al Masila basins.
APPEAL FOR HELP
Years of warlord-fuelled
bloodshed put those plans on hold, but after routing rival
Islamists from Mogadishu last month, Somalia's interim
government is desperate to attract investors.
“Somalia has a lot of oil,
and our ministers have just approved a key exploration law
to regulate how concessions are given out,” government
spokesman Abdirahman Dinari said.
“But what we need now is
international support to restore security and build our
nation, and we will be noting who helps us and who doesn't
when these decisions are taken.”
As his administration
fights to set up centralised rule for the first time since
dictator Mohamed Siad Barre was overthrown 16 years ago, the
U.S. majors are watching from the sidelines.
They each have hundreds of
millions of dollars from high oil prices to spend on
exploration this year, but have been burned in countries
like Venezuela, Ecuador, Bolivia and Russia, which are all
taking a much tougher stance on production deals.
That has boosted Africa's
profile, while factors like growing violence in Nigeria and
rising taxes for producers in Algeria have shone a new
spotlight on the eastern seaboard.
Much of the interest is
from Chinese, Indian and Malaysian firms with deep pockets,
technological skills and an appetite for higher insecurity
than Western competitors, experts say.
China, the world's second
top energy user, already funds oil projects from Angola to
Sudan, and is eyeing opportunities in northern Somalia and
neighbouring Ethiopia's Ogaden region.
WILDCATTERS PROFIT
“The huge Chinese companies
now have full technical expertise, and they no longer ever
feel it necessary to take Western partners,” said one
veteran Western oil executive.
But smaller, fast-moving
firms ready to work in difficult areas, often without the
protection of mainstream insurance, are getting a slice of
the action on the new east African frontier.
Australia's Woodside
Petroleum is drilling off Kenya, South African independent
Ophir Energy is prospecting off Tanzania and Sweden's Lundin
Petroleum is surveying in Ethiopia.
Some are even proving that
work is possible inside Somalia itself – albeit in the
calmer north.
Australian minnow Range
Resources won a company-making deal in 2005 giving it
concession rights to all minerals and petroleum in
semi-autonomous Puntland, home to Somalia's president and
former warlord Abdullahi Yusuf.
Unfazed by a mortar duel
between rival clans last March on the nearby border with
Somaliland, Range is bullish.
Last month, it unveiled a
six-year agreement under which Canada's Canmex Minerals will
spend $50 million on exploration for an 80 percent stake in
the project.
Much more controversial in
Mogadishu are exploration efforts in Somaliland, a breakaway
enclave that split from the rest of Somalia in 1991 and has
since enjoyed relative peace. It is also sitting on the most
promising geology.
South Africa's Ophir has a
coastal block there, and Chinese and Indian companies are
also thought to be seeking acreage from the internationally-unrecognised
Somaliland government.
“These are issues we have
to work out, but we are all Somalis and we will solve them
with dialogue,” Dinari said.
REUTERS
Oil search may head to
Somalia
Publication Date: 2/23/2007
Gunmen ambush troops as insurgents fire rockets at military
bases and pirates prowl the turquoise Indian Ocean shipping
lanes offshore.
Somalia may be seem an unlikely prospect for investors
seeking untapped oil and gas fields, but that could be about
to change as the majors turn their gaze off the beaten
track.
Driven by record profits, a race with hungry Asian rivals
and fears of growing energy nationalism in South America and
Russia, interest in eastern Africa has never been higher.
“Africa across the board has seen a substantial uptake in
acreage in recent years by all sizes of companies from the
majors to mega-majors, independents and minnows,” said
Duncan Clarke, chairman and chief executive officer of
international energy consultants Global Pacific & Partners.
“Quite a few significant players have moved into position.”
Big Western companies including ConocoPhillips, Chevron and
Total held Somali exploration concessions before the country
slid into civil war in 1991.
A World Bank and UN survey that year of eight northeastern
African countries’ petroleum potential ranked Somalia second
only to Sudan as the top prospective commercial producer.
Regional window
Northern Somalia lay within a regional oil window reaching
south across the Gulf of Aden, the geologists said.
Encouraged by that, explorers hoped to find an extension of
the crude-bearing deposits that hold nearly 4 billion
barrels under Yemen in the Marib-Hajar and Say’un-Al Masila
basins.
Years of warlord-fuelled bloodshed put those plans on hold,
but after routing rival Islamists from Mogadishu last month,
Somalia’s interim government is desperate to attract
investors.
“Somalia has a lot of oil, and our ministers have just
approved a key exploration law to regulate how concessions
are given out,” government spokesman Abdirahman Dinari said.
“But what we need now is international support to restore
security and build our nation, and we will be noting who
helps us and who doesn’t when these decisions are taken.” As
his administration fights to set up centralised rule, the US
majors are watching from the sidelines.
They each have hundreds of millions of dollars from high oil
prices to spend on exploration this year, but have been
burned in countries like Venezuela, Ecuador, Bolivia and
Russia, which are all taking a much tougher stance on
production deals.
That has boosted Africa’s profile, while factors like
growing violence in Nigeria and rising taxes for producers
in Algeria have shone a new spotlight on the eastern
seaboard. (Reuters)
http://www.nationmedia.com/
and
http://www.sudantribune.com/spip.php?article20395
or
http://www.signonsandiego.com/news/business/20070222-0527-somalia-oil-.html