Kenya is optimistic of reaching a deal with Somalia over the exploration of
resources around a disputed section of their shared Indian Ocean off-shore
border territory.
In its preliminary prospectus for the planned Sh132 billion Eurobond, the
government said the two countries were in discussions to amicably resolve
the matter.
"Kenya and Somalia are in discussion with regards to their respective
submissions to the UN Commission on the Limits Continental Shelf," the
document said in part.
Kenya and Somalia signed a memorandum of understanding in 2009 that the
border would run east along the line of latitude, but Somalia, which has
lacked an effective central government since 1991, then rejected the
agreement in parliament.
In 2012, the Somali government accused Kenya of awarding offshore oil and
gas exploration blocks illegally to multinationals Total and Eni, claiming
that the concessions lie in waters claimed by Somalia.
Kenya denied the accusation that ownership of the blocks was contested and
said there was no need to hold up exploration. Both countries have since
submitted separate submissions to the UN agency seeking to claim additional
territory on the shared Indian Ocean border.
According to the UN Convention on the Law of the Sea, all countries that
border the ocean are allowed to use the 200 nautical miles into the ocean
for exclusive economic purposes without interference from other countries.
Kenya formally laid claim to an additional 103,320 square kilometres of
seabed off its coastline, beating an April 13, 2013 deadline that was set
for the submissions.
Failure to beat the deadline would have left all exploration and
exploitation rights over the territory in the hands of the International
Seabed Authority (ISA).
Failure to secure such rights would also mean that firms eyeing investments
in such zones would have to go through strenuous and expensive processes to
secure permission from the ISA.
Kenya and Somalia habour ambitions of striking oil and gas off-shore and
analysts say they would immensely benefit from privileged provisions of the
UN convention.
The provisions exempt developing countries that are net importers of a
mineral resources produced from its continental shelf from financing the
exploration of non-living resources beyond the 200 nautical mile limit.
Kenya and Somalia are net importers of oil and gas and qualify for the
exemption. Kenya is also in talks with Tanzania over the demarcation of
their shared Indian Ocean territory as the scramble for off-shore resources
intensifies.
Tanzania made a late claim in 2012 for its share of the Indian Ocean
territory, delaying the commencement of proceeding to decide the demarcation
of the extra seabed claimed by Kenya and Somalia.
Kenya, by virtue of sharing a common border with Tanzania, had to wait for
Tanzania's final submission to get the UN's verdict on its application.
Received on Sun Jun 08 2014 - 16:14:59 EDT