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EAEF moves to oppose Soma Oil and Gas deal

Thursday, August 15, 2013

The Federal Government of Somalia's recent deal with Soma Oil and Gas is facing heavy opposition from the East African Energy Forum (EAEF), a group of Somali resource experts and lawyers that monitor Somalia's natural resources, waters, territorial integrity and sovereignty.

The EAEF says it is opposing this deal after conducting a thorough investigation and concluding it to be contrary to the Somali national interest with little net benefit to the public.

"This deal goes against the very principle of transparency and anti-corruption that this government took an oath on last year, We are surprised at the cloud of secrecy and "behind-closed-doors" methodology this government believes they can deal our natural resources in." says Abdillahi Mohamud, the group's director.

The group says that the Federal Government has committed to the principles of the Extractive Industries Transparency Initiative (EITI) during the pre-G8 summit on trade, tax and transparency this year in the UK and has duties to implement transparency and anti-corruption measures.

Aside from the lack of transparency, the group is also blasting the technical quality of the deal and companies involved that have signed with the central government.

"Does this government and these companies believe that Somalis who are experienced in the fields of petroleum and maritime affairs would blindly look the other way while unprofessional and biased deals are made with their natural resources and waters; the only source of future wealth and hope a nation of 10 million has left to recover?" asked Mr. Mohamud.

The EAEF has called on the central government to cancel the Soma Oil and Gas deal immediately and to review the procedures used to strike this deal, believing that this will set a precedent of shady deals being common practice in Somalia.

The EAEF's technical team says that Soma Oil and Gas does not have the expertise or the capacity to conduct the offshore seismic survey themselves and would need to sub contract to a capable seismic company. It also added that it is a blatant conflict of interest to allow a company to collect the seismic data that the government plans to use to sell oil blocks, at the same time allowing it to choose whichever blocks it wants in a private sale.

"How can a company barely four months in existence be given the reigns to explore in our offshore waters? Who are their sub-contractors that will actually do the work? Why aren't reputable seismic companies being allowed to bid on this project in public as is the industry norm? The government should cancel this deal and conduct itself in a transparent and open manner that is good business for the country." said Feysal Mayow, the EAEF's technical director.

The group has also raised the alarm that the central government has abandoned its initial suggestion that it will not engage in oil deals until it has harmonized a robust petroleum law with the constitution and begin talks with the regions on this topic.

“Under what Somali law will this company be governed, which environmental standards, which statutes will they be held accountable in Somalia? The answer is none, because the government has found it a “nuisance” to have proper laws that Somalis can support and rally behind.” Said Mr.Mayow.

The Somali insecurity situation is underpinned by a race for natural resources at a time when other priorities should be taking center stage says the EAEF.

"Much of the conflict in Somalia today is about economic security, namely about ownership of natural resources and land, this move will only exacerbate the powder-keg situation in the country at a time when we should be focusing on reconciliation and security." Says Abdillahi Mohamud.

The EAEF says it has been supporting the central government with capacity building initiatives, but that the FGS has got the cart before the horse in this deal and is pressuring the government to invest in its institutions, public procurement, and transparency and anti-corruption systems.

"We should be focusing on building the relevant Ministries, training Somali bureaucrats in these fields, producing laws that protect Somalia's resources economically and environmentally, not signing shady deals with a barely four month old company." says Feysal Mayow.

"It seems elements within the FGS as well as some foreign companies still think that Somalia is that place you can conduct a shady deal and go unnoticed. The Somalis are no longer dormant in their politics and the EAEF as citizens of the country will continue to hold its government and commercial partners to account." Mr. Mayow adds.

The group has said it will continue its investigation and monitor developments as well as using its influence in parliament and other avenues to oppose this deal. It is encouraging Prime Minister Shirdon to nullify this deal and open a review of how the deal was sourced and signed.

“I don’t think Somalis are interested in these unprofessional deals while their country is rife with insecurity and political bickering. The government should be focusing on that which matters the most and not signing shady oil deals. This is a sector that requires well functioning public institutions and at the moment we haven’t got those to an acceptable standard” Said Abdillahi Mohamud.


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