- The Somali government early October 2015 rejected a United Nations halt on oil deals on the country considered as one of the world’s most fragile states.
- The United Nations argued in Nairobi that Somalia lacks a legal and regulatory framework to oversee the exploitation of energy resources.
- This, according to the new UN Monitoring Group report on Somalia, to be released in mid-October accrues to the government which is not yet stable and which must be supported by international efforts.
- Finance Minister Mohamed Adan said the country will not welcome a blanket oil moratorium.
Somalia has untapped reserves of numerous natural resources, including uranium, iron ore, tin, gypsum, bauxite, copper, salt and natural gas, all of which present possibilities that could place Somalia on a regional map as an economic hub.
Due to its proximity to the oil-rich Gulf Arab states such as Saudi Arabia and Yemen, the nation has also long been believed to contain substantial unexploited reserves of crude oil. A 1992 survey ofNortheast Africa by the World Bank and UN ranked Somalia second only to Sudan as the top prospective producer
In December 2014, Soma Oil and Gas, a London based energy company, searching for hydrocarbon deposits off the coast of Somalia, announced that it had completed a seismic survey to ascertain the potential for recoverable oil and gas deposits.
And now, the London-based company that spent $40 million conducting surveys in Somalia has asked the British government to help block the proposal to ban Somalia oil deals.
Soma has previously proposed a deal with the Somali government that may grant it as much as 90 percent of the country’s prospective oil revenue. However, Adan says that Somalia will not go ahead with any profit-sharing arrangement without the proper legislation and policy framework.
Somalia hasn’t had a functioning central government for the past quarter century as it’s been wracked by civil war and an insurgency by al-Qaeda-backed Islamist militants.
The African Union has deployed about 22,000 peacekeepers to help government forces stabilize the country. Gains against the insurgents since August 2011 have enabled the government to begin exerting its authority over southern and central areas.
In future, the Somali government has been asked to put regulations in place to ensure oil resources benefit its citizens.