Which oil company is coming to Berbera?

A Norwegian oil company is set to start drilling a well on block 18 in Sool and Sanaag region, possibly in partnership with DP World.

DNO-SomalilandAlthough nothing has officially changed so far as Somaliland’s oil sector is concerned, given that Mogadishu is determined to remain in the driving seat, The Indian Ocean Newsletter has learnt that the port operator DP World – which is in charge of extending the port of Berbera (ION 1463) – and President Musa Bihi Abdi are in talks with a Norwegian oil company. According to our information, the newly elected president is keen to show his generosity towards Norway, which is a potentially influential ally in his bid to resolve the issue of Somaliland’s recognition as an independent state. The junior oil company DNO ASA, which is listed on the Oslo stock exchange, looks set to start drilling a well on block 18 in the province of Sool and Sanaag region, possibly in partnership with DP World.

The boss of DNO ASA, Bijar Mossavar-Rahmani, obtained an operating licence through an agreement signed directly with the former president Ahmed Mohamed Mahamoud (aka Silanyo) four years ago in New York, and this was extended in 2016. Exploration missions were conducted back in 2008 and 2009. DNO ASA is also present in South Yemen and Kurdistan.

Source: ION, January 09, 2018
© Copyrights 2018 Indigo Publications All Rights Reserved

Norway’s DNO Says Shots Fired Near Somaliland Team

Norwegian oil company DNO Says No Plans to Exit Region

OSLO–Norwegian oil company DNO ASA said Wednesday that several shots were fired near a team conducting a water survey on its behalf in Somalia’s Somaliland region on Monday, but said it had no plans to exit the self-governed region.

DNO is currently exploring for oil in Somaliland, a part of Somalia that has been more stable than the rest of the country in recent years, and largely ruled by its own local government, which is trying to break away from the rest of the country. Somalia’s Mogadishu-based central government has said deals between oil companies and the Somaliland regional government are illegal.

“At approximately 3:30 p.m. local time [August 11], a limited number of gun shots were reportedly fired in the vicinity of the team,” said DNO spokesman Henrik Schwabe in an email. “No one was injured and the team was immediately repatriated to Hargeisa.”

DNO said the team was conducting a water survey in the Hudun (Xudun) area of the SL-18 license block in Somaliland on its behalf, as part of a DNO-funded project to provide local communities with safe drinking water. The company didn’t disclose the team’s nationality.

“The Somaliland authorities are investigating the matter further,” Mr. Schwabe said.

DNO said it was aware of local media claims that the company would exit Somaliland, but said that was incorrect speculation.

Somaliland’s Minister of Foreign Affairs Mohamed Behi Yonis said he had heard about the Hudun (Xudun) gunfire incident but didn’t know the full details. He said the region’s authorities were in the process of recruiting a security force, paid for by oil companies, to protect its oil assets.

“Soon we will hopefully have an oil protection unit,” Mr. Yonis said, adding that the force would number about 420 recruits. “We won’t have any events then,” he said.

Somaliland’s Minister of Energy wasn’t immediately available for comment.

A United Nations monitoring group earlier this year said it was concerned about Somaliland’s effort to build a security force, according to internal U.N. documents reviewed by The Wall Street Journal, in part because Somalia is subject to a U.N. arms embargo aimed at curbing years of conflict.

“As in every country in which we operate, the safety and security of operations is our first priority,” said Mr. Schwabe. “We are in regular contact with the Somaliland authorities and closely monitor the security situation in Block SL-18.”

Anglo-Turkish oil company Genel Energy PLC, which holds stakes in several licenses in Somaliland, pulled out of the autonomous region last September due to “a deteriorating security environment.” The company has since been in discussions with the Somaliland government on whether to resume its activity.

DNO has a 60% stake in the SL-18 license, a frontier onshore exploration block. It has completed a study of remote data and plans to gather seismic data in the area. DNO has previously said that it expected to spend between $10 million and $20 million on its Somaliland activities.

The company, based and listed in Oslo, has activity across the Middle East and North Africa, including the Kurdistan region of Iraq, Yemen, Oman, the United Arab Emirates, Somaliland and Tunisia. DNO produced 39,170 barrels of oil equivalent a day in 2013.

By Kjetil Malkenes Hovland
Source: Dow Jones Institutional News, August 13, 2014
© 2014, Dow Jones & Company, Inc.

DNO signs agreement for Somaliland exploration block

Somaliland-DNO

Former Somaliland leader, Ahmed M. Mohamoud Silanyo, and DNO International´s Executive Chairman, Bijan Mossavar-Rahmani, attended the signing ceremony in the Washington, D.C. on July 16, 2013.

Cape Town (Platts)– Norway’s DNO International said Tuesday it has signed a production sharing contract for an onshore oil and gas exploration block in Somaliland, marking the previously Middle East-focused company’s debut in sub-Saharan Africa.

DNO, which has operating headquarters in the UAE emirate of Ras Al-Khaimah, said in a statement that it initiated studies of block SL 18, located in the semi-autonomous Somaliland region of northern Somalia, ahead of an extensive seismic program planned for 2014.

“This 12,000 square kilometer block adds substantial exploration acreage to DNO International’s portfolio and in an area that is both prospective and undrilled,” said DNO Executive Chairman Bijan Mossavar-Rahmani.

He said Somaliland fell within the company’s geographic and geological “comfort zones,” as a DNO predecessor company had been active across the Gulf of Aden in Yemen since the late 1990s.

Norwegian-registered DNO, in its current corporate structure, was formed in 2011 through a reverse takeover by the UAE’s RAK Petroleum following a boardroom coup. The combined company retained the DNO International name and the company’s listing on the Oslo bourse.

In recent years, DNO has been best known for its pioneering oil exploration and development activities in Iraqi Kurdistan, where it operates the Tawke oil field. The company also produces oil and gas in Oman and the UAE and has exploration activity in Tunisia.

The agreement for Somaliland’s block SL 18 was signed Monday in Washington, D.C., at a ceremony attended by Somaliland President Ahmed Silanyo and Minister of Mining, Energy and Water Resources Hussein Dualeh.

DNO is the third international oil company to acquire petroleum exploration acreage in Somaliland during the past three years.

“This deal is a very significant milestone for us and raises our portfolio on the oil patch,” Dualeh told Platts by telephone from Washington.

Other companies, he said, were showing interest in the country’s energy sector, though he denied reports that China’s CNOOC was eyeing opportunities.

Anglo-Turkish Genel Energy, which is DNO’s partner in Kurdistan’s Tawke field, farmed into a Somaliland exploration license in 2012, after reaching a working arrangement with the original concession-holder, UK-based Asante Oil.

Dualeh said Genel is carrying out a “very bullish” work program, with a 2-D seismic campaign for its two production sharing contracts covering five blocks, to commence in 2013. The company expects to drill the first well in the second half of 2014.

Ophir Energy is also negotiating for a 2-D seismic contract with plans to drill its first well in 2015.

Australia’s Jacka Resources, in partnership with the UK’s Petrosoma, is also conducting exploration activities.

International exploration and production companies are taking their activities in Somaliland to a scale not seen since the country regained its independence 21 years ago. Though one of the least explored countries in the region, Dualeh believes the country has the potential for considerable reserves.

There are, he said, no immediate plans to host an oil licensing round, and said the ministry of energy has opted for an open door policy with the companies though this could change if there is an oil discovery. “Ideally, when you have a discovery, a bid round works,” he said.

Given Somaliland’s geo-strategic location, there are good reasons that if commercial oil is found, it could become a major trading hub between Africa and the Middle East.

Lacking international recognition since it declared independence from Somalia in 1991, the break-away African nation has its own political system, currency and economic development.

War-torn Somalia and semi-autonomous Puntland, Somaliland’s neighbors, are also hoping to profit from interest from foreign oil companies. Somalia plans to put 30 blocks up for auction this year, giving priority to companies that operated in the country before its government fell more than ten years ago.

Significant gas finds in Mozambique and Tanzania and oil reserves in Uganda and Kenya have also boosted competition among oil companies seeking to secure acreage the region.

Source: Platts Commodity News, April 23, 2013
 © Copyright 2013. Platts. All Rights Reserved.

Oil discovery in two Somalia areas may fuel violence, says UN

Somaliland and Puntland dispute a border criss-crossed by oil concessions that have been awarded to companies including Norway’s DNO International, Vancouver-based Horn Petroleum and RAK Gas of the United Arab Emirates.

NAIROBI – Two semi-autonomous areas of northern Somalia have largely avoided the violence that has plagued the rest of the country for decades. Now oil exploration may change that, according to the United Nations (UN).

Territorial disputes between the governments of Somaliland and Puntland, a separatist campaign by a clan-based group and “discrepancies” in oil licensing throughout Somalia are all contributing to simmering tensions in the region, the UN Monitoring Group on Somalia and Eritrea said in a May 28 memorandum.

Somaliland’s planned deployment of an oil-protection force in the region may also deepen the strains, it said.

“Urgent attention must be given to this issue to avoid commercial activity triggering conflict further down the road,” the monitoring group’s coordinator Jarat Chopra said. The document was sent to Bloomberg by a UN official who asked not to be identified because it has not been released.

Somaliland and Puntland dispute a border criss-crossed by oil concessions that have been awarded to companies including Norway’s DNO International, Vancouver-based Horn Petroleum and RAK Gas of the United Arab Emirates.

Oil deposits in Somalia may amount to as much as 110-billion barrels, according to a report published last week by the Mogadishu-based Heritage Institute for Policy Studies.

Saudi Arabia, the world’s biggest oil exporter, has 266-billion barrels of proven reserves, BP data show.

Somaliland declared independence in 1991 following a coup in the capital, Mogadishu, and drew boundaries along the lines of pre-colonial borders of the British and Italian occupied territories.

Puntland, which declared itself an autonomous state in 1998, claims parts of Somaliland in the Sanaag and Sool regions.

Khatumo, a clan-based political organisation, said it has sovereignty over land that straddles the boundary, according to the UN monitoring group.

The prospect of further oil discoveries has sparked a “resource race” in which different political actors are carving up oil blocks to enhance their bargaining power against rivals, the Heritage Institute said. “The oil factor is likely to hamper rather than help Somalia’s endeavour to rebuild a stable state,” it said.

Mr Chopra cites March clashes in Sanaag province following a visit by Somaliland’s President Ahmed Mohamed Silanyo and the deployment of forces in Sool by Somaliland and Puntland as examples of worsening relations.

“While there has not been major conflict to report, political and military tensions have nonetheless escalated in recent weeks,” he said.

Somaliland Energy Minister Hussein Abdi Dualeh did not immediately respond to e-mailed questions.

In a comment on his Twitter account on June 7, Somaliland’s president urged the UN monitoring group to “stop meddling in the affairs of Somaliland”. The semi-autonomous region will “protect its economic assets”, he said.

Since presidential elections in January, Puntland President Abdiweli Mohamed Ali Gaas has been lobbying Khatumo representatives and other clans to drop their independence movement in support of Puntland, aggravating tensions with Somaliland, the UN said. Khatumo has challenged the legitimacy of DNO’s license with Somaliland in the Nugaal block.

DNO entered Somaliland in April last year with a block in the Nugaal valley and have a competing claim with Horn Petroleum, which was issued a license in the disputed area by Puntland’s government.

Horn Petroleum is working to resolve disputes over the Nugaal block with the Puntland, Somaliland and Somali governments, along with London-based Genel Energy, DNO and other organisations like the UN, Africa Oil – Horn’s parent company – vice-president of external relations Alex Budden, said.

The UN is also concerned about the Somaliland government’s plan to hire Assaye Risk, a UK-based private security contractor, to train and equip a force to protect oil exploration workers at a cost of as much as $25m.

“The deployment of the oil-protection unit could play into internal and regional conflicts that appear to be brewing within Somaliland and between Somaliland and other regional authorities,” Mr Chopra said.

Deeq Yusuf, chief of staff in the Puntland presidency, said his government sees the oil-protection unit as “part of the continued aggression and clan expansion of Somaliland against the territory and people of Puntland”.

Assaye Risk director Arabella Wickham said the 420-member oil protection unit (OPU) would provide security services to global oil firms allowing the country to pursue one seismic operation.

“Within the blueprint, Assaye Risk clearly defined the operational remit of the OPU as defensive and pre-emptive only with a mandate confined to protective services in support of the energy industry.” The “government-owned and commercially operated” unit would be recognised by the UN and constituted by Somaliland law, she said.

Puntland has a similar force known as the Explorations Security Unit that provides protection for Africa Oil workers, said the Heritage Institute.

Source: Energy Monitor Worldwide, June 11, 2014
© 2014 Global Data Point. All Rights Reserved.

Somalia oil wells

Somalia Oil wells as of 1991

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