The genie is out of the bottle. Somalia is an oil giant.

[Crow]

The Federal Government of Somalia (FGS) has demarcated 15 blocks to be offered in its controversial offshore licensing round, with technical partner Spectrum Geo estimating the acreage could hold 30 billion barrels of potential oil resources.

The blocks are located off four states — Jubbaland, South West, Hirshabelle and Galmudug — and were revealed for the first time at a roadshow in London last week that attracted representatives from oil companies, including BP, Anadarko and Turkish Petroleum.

Further roadshows are planned for Istanbul in late March and Houston in early May.

Protesters outside the London venue shouted their disapproval of the licensing round while, after presentations, a Somalian man launched into a tirade against the current government in Mogadishu before being removed from the venue.

They believe Somalia is too unstable for a round to benefit the entire country, citing legal, constitutional, political and ethnic discord along with the ongoing threat posed by Al Shabaab, the Islamist group.

Speaking to Upstream, Karar Shukri Doomey, Director General at the Ministry of Petroleum, countered some of these arguments, saying a resource-sharing agreement has been signed by five of Somalia’s states, including Puntland, but not Somaliland.

However, one source familiar with Puntland said he was not aware of such a deal being signed.

As for legislation, Doomey said the round is based on an amended 2008 Petroleum Law.

“We have drafted an amendment with the member states. When parliament resumes, we are very confident that within seven months it will be approved.”

He told delegates that “no contract will be signed unless all the regulatory framework is in place. All we have done today is present the data. It is a massive opportunity for Somalia.”

At the end of his presentation, Doomey introducd US venture capitalist Darin Pastor to the audience, saying he is ready to invest billions of dollars into Somalia.

Chief executive of Capstone Financial Group, Pastor told Upstream he already was an active investor in Somalia and would look to become a partner in offshore blocks, “teaming up with experienced operators”.

He said talks had already been held with a number of “majors”.

It is understood that Buffalo, New York-raised Pastor has links with FGS President Mohamed Abdullahi Farmajo who lived and worked in the Buffalo area of the US between 1989 and 2010.

Pedro Van Meurs, who is advising the FGS on an appropriate fiscal regime, said the bid process will be “transparent”, with winning bidders to be awarded a PSA without the need for further negotiation.

He said the PSA already contains “significant obligations” to prioritise Somali citizens, businesses and goods.

Commenting on the acreage being offered, Spectrum’s director of geosciences Karyna Rodriguez said: “These are the most prospective blocks. There is not one state that does not have a lot of opportunity and there isn’t one block that does not have prospectivity.

“We have a total of at least 30 billion barrels of unrisked oil potential,” she added.

Rodriguez said Spectrum’s work indicates strongly that the acreage is oil prone — based on source rock studies, oil slicks and seep mapping and a thorough evaluation of 2D seismic data — and she went on to highlight multiple different play types.

The play types include a Jurassic carbonate complex with 6 billion barrels of resource potential and a Cretaceous carbonate play that may house 2.5 billion barrels of oil.

More than 200 tilted-fault block leads have been identified, with 10 of those each holding potential resources larger than 500 million barrels.

More than 60 near-shore anticline leads have been mapped with as much as 500 million barrels of resources individually.

Tertiary and Cretaceous toe-thrust leads have also been identified as well as outboard, transgressional anticlines and other anticlines.

Spectrum opened a data room on 8 February, with oil companies having until 11 July to submit applications to pre-qualify to bid.

By late August, the ministry is aiming to select qualified operators and non-operators, with a final version of the production sharing agreement to be published on 12 September.

Bids need to be submitted by 7 November while PSAs are due to be signed by 9 December, approved by the government by 19 December and to be effective from 1 January 2020.

This is a report from a major western oil site.

Out of the 206 blocks analysed by Spectrum, only 15 of those are being put up for bid. Just those 15 blocks alone have 30 billion barrels.

Those 15 blocks alone put us at number 11 in this list, tying us with Kazakhstan and making us third in the continent.

Again, we currently have 206.

Now consider this. We are only looking at offshore oil. We haven't even considered the massive potential onshore. Furthermore, Spectrum didn't even look at our entire offshore reserves. They only have data from Jubaland to Galmudug. That's only 1000 km of coastline. That's where those 206 blocks that have been analysed are located.

Add in Puntland's 1600 km coastline and Somaliland's 600 km, and you'll have a lot more blocks than 206. Now add in the entire country's onshore reserves (which are expected to be huge) and you're looking at an oil behemoth.

The genie is out of the bottle. There is no going back from this. A new era has begun.

 

[Tukraq]

Kenya’s already crying in the corner

 

[Crow]

The world's filth and vultures like Darin Pastor are already salivating. Somalia's profile has suddenly shot up. We don't have to worry about Kenya stealing our sea anymore because we now have the backing of the world's oil industry.

Why would they support an oiless and coastless country like Kenya when helping us gives them access to our bazillion barrels?

We must take full advantage of our new prominence. This is our ticket out of the dark ages.

 

[Mr.Haggis]

I have the feeling we have the most oil in the world. Look at that coastline!

 

[Mr.Haggis]

Please no bp! If I was farmaajo I would set up an oil company like Somali petroleum and then sell oil for gold!

 

[Farm]

Please no bp! If I was farmaajo I would set up an oil company like Somali petroleum and then sell oil for gold!

Once the petroleum bill is passed a Somali national oil company will automatically be formed, hopefully we own all our oil eventually.

 

[Mr.Haggis]

Once the petroleum bill is passed a Somali national oil company will automatically be formed, hopefully we own all our oil eventually.

Yes Sir!

 

[Tukraq]

Once the petroleum bill is passed a Somali national oil company will automatically be formed, hopefully we own all our oil eventually.

How do I get stocks in said company

 

[Mr.Haggis]

Once the petroleum bill is passed a Somali national oil company will automatically be formed, hopefully we own all our oil eventually.

Bro I read somewhere that we have at least 110
Billion barrels of oil

 

[Farm]

How do I get stocks in said company

I don’t think you can, I believe it’s suppose to be state owned

 

[Farm]

Bro I read somewhere that we have at least 110
Billion barrels of oil

VOA reported that also this week for offshore.

 

[Mr.Haggis]

30 billion barrels of oil - today’s price is over 1.5 trillion dollars

 

[Bohol]

This is one of the reasons why the southern states were unstable for a while. Too many interest groups.

 

[Karim]

This is our ticket to the Stars but extracting the resources without an agreement between FGS and Federal member states is way too risky.

Article 44 of the constitution which mentions exploration and sharing of the revenue allocated from natural resources is very confusing and didn't clarify shit.
Article 44: “The allocation of the natural resources of the Federal Republic of Somalia shall be negotiated by, and agreed upon, by the Federal Government and the Federal Member States in accordance with this Constitution.”

 

[Farm]

This is what Norway’s Spectrum said

All the blocks have prospectivity,” Rodriguez concluded, “and the prospectivity is the greatest we have ever identified

Spectrum was founded in 1986.

 

[Crow]

This is our ticket to the Stars but extracting the resources without an agreement between FGS and Federal member states is way too risky.

Article 44 of the constitution which mentions exploration and sharing of the revenue allocated from natural resources is very confusing and didn't clarify shit.
Article 44: “The allocation of the natural resources of the Federal Republic of Somalia shall be negotiated by, and agreed upon, by the Federal Government and the Federal Member States in accordance with this Constitution.”

I agree. The FGS could really mess this up for us. Hopefully they come to a fair agreement next month in the Garowe reconciliation conference.

There's no reason to try to rip off the federal member states when there is way more oil than any of us could possibly ever fully sell. But we will see what they try.

This is what Norway’s Spectrum said



Spectrum was founded in 1986.

Allahu akbar.

 

[diaby]

Let's hope we don't turn into the next Congo

 

[Marquis]

I hope they use all the money to develop Mogadishu and its surrounding areas.

 

[GBTarmy]

Let's hope we don't turn into the next Congo

that's my biggest fear, inshallah we won't.

 

[Farjano-Walad]

This is a report from a major western oil site.

Out of the 206 blocks analysed by Spectrum, only 15 of those are being put up for bid. Just those 15 blocks alone have 30 billion barrels.

Those 15 blocks alone put us at number 11 in this list, tying us with Kazakhstan and making us third in the continent.

Again, we currently have 206.

Now consider this. We are only looking at offshore oil. We haven't even considered the massive potential onshore. Furthermore, Spectrum didn't even look at our entire offshore reserves. They only have data from Jubaland to Galmudug. That's only 1000 km of coastline. That's where those 206 blocks that have been analysed are located.

Add in Puntland's 1600 km coastline and Somaliland's 600 km, and you'll have a lot more blocks than 206. Now add in the entire country's onshore reserves (which are expected to be huge) and you're looking at an oil behemoth.

The genie is out of the bottle. There is no going back from this. A new era has begun.

careful what you wish for brother, remember the resource curse that blights nations when they discover oil and other godly gifts?