Somalia will launch its first hydrocarbon licensing round early 2017 targeting offshore blocks. Somalia’s Minister of Petroleum and Mineral Resources, Mohamed Mukhtar Ibrahim, unveiled details on the plans for a 2017 license round during the Africa Oil Week held in Cape Town late October, Reuters Reported.
Ibrahim also hosted a roadshow to cover further updates for Somalian hydrocarbon development, such as legal and regulatory updates and information on 2D seismic data results. However, Permanent Secretary at the ministry, Jamal Kassim Mursa, said that shallow water block concessions signed in 1988 by Shell and ExxonMobil are excluded from the new bid round, according to Oil Review Africa.
Historically, oil exploration in Somalia dates back to 1948 but due to it’s volatile political and security environment, Somalia was still under-explored when, in the late 1980s, several major oil companies signed concession agreements with the Siyaad Barre military regime, informed Geeska Afrika. The outbreak of the civil war and the collapse of the regime led oil companies to declare force majeure and abandon exploration activities overnight.
Despite the drop in oil prices since mid-2014 and the volatile security environment, the extent of oil exploration across Somalia remains significant.