AFRICA MONEY-Somaliland hopes oil will replace goat dependence
Thu Nov 1, 2012 2:52pm GMT
By Ed Stoddard
CAPE TOWN Nov 1 (Reuters) - Wanted: investors for small African nation with
good oil and mineral potential - no seat at the United Nations but history
of independence in rough neighborhood.
The break-away nation of Somaliland is a tough sell but the announcement
this week that serious hydrocarbon exploration is about to kick off there
shows that oil talks, regardless of political status.
For Somaliland, an internationally unrecognised state of 3.5 million people
that declared independence from Somalia in 1991, it promises to be a game
changer.
"We need to find a way to earn hard currency besides selling goats, sheep
and camels to Arabs. This is the only way we earn hard currency now,"
Hussein Abdi Dualeh, the minister of energy and mining, told Reuters on the
sidelines of an African oil conference in South Africa organised by Global
Pacific & Partners.
Ophir Energy Plc, Australia-based Jacka Resources and Genel Energy, which is
headed by former BP chief executive Tony Hayward, are all about to start
exploration in Somaliland.
Dualeh said the investments would be worth tens of millions of dollars,
small change in the global oil industry but a windfall to a government that
only has a budget of $120 million.
Gas discoveries off Mozambique and Tanzania and oil finds in Uganda and
Kenya have sparked a hydrocarbon scramble into previously unexplored parts
of Africa.
Oil companies often go where other investors fear to tread, including other
unrecognized statelets such as Kurdistan.
"Oil companies are concerned about geology, not politics," Dualeh said.
He also said Somaliland offered investors something sorely lacking in
anarchic Somalia: stability.
"We control our borders, we have a police force and military. We have had
four governments come and go with democratic elections," he said.
The territory has not exactly been an oasis of peace, however. Fighting
erupted there in January after the leaders of the northern regions of Sool,
Sanaag and Cayn decided to band together into a new state called Khaatumo.
Somaliland's troops have since clashed with militia fighters loyal to
Khaatumo, with reports of dozens of casualties.
And what about pirates?
"The pirate problem is not off our coast, it starts in the Indian Ocean with
Somalia. We have a nimble coast guard that does its job with limited
resources," Dualeh said.
If oil is discovered, Somaliland would also welcome the steady stream of
revenue that would follow.
Dualeh said livestock sales across the Red Sea to Saudi Arabia followed a
seasonal pattern with sales peaking during the annual haj pilgrimage.
"We need to get stuff out of the ground. Selling livestock during the haj is
not sustainable," he said.
C Thomson Reuters 2012 All rights reserved
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Received on Thu Nov 01 2012 - 19:10:37 EDT
