Saturday August 13, 2022
Mogadishu (HOL) - The African Energy Chamber (AEC) congratulated Somalia’s new petroleum minister on his appointment and said they hope he will accelerate investment in the nascent sector.
“The AEC would like to commend H.E. Minister Mohamed on his appointment as Minister of Petroleum and Mineral Resources of Somalia. This represents a great accomplishment, and the AEC believes that he will take on his new role with drive, innovation and resilience,” said NJ Ayuk, Executive Chairman of the AEC, in a press statement released on Friday.
Ayuk added that the global hunt for new hydrocarbon deposits positions Somalia to benefit in the near future.
“In 2022, with global market trends constantly fluctuating and international destinations urgently looking for new oil and gas deposits, unlocking the true potential of Somalia’s hydrocarbon sector will be key, not just for the country itself but the entire continent. The AEC looks forwards to seeing what H.E. Minister Mohamed will accomplish in his new position and offers our support throughout his term,” states NJ Ayuk, Executive Chairman of the AEC.”
The AEC commended outgoing petroleum minister Abdirashid Mohamed Ahmed for steering the ship “despite global market and domestic economic challenges.’
Somalia, which represents one of the final frontiers for oil and gas exploration globally, relies exclusively on oil and gas imports. Still, AEC believes this can change if Minister Mohamed prioritizes exploration, infrastructure development and regional cooperation.
“Much of the country’s offshore basins have yet to be explored, and with previously attained seismic data revealing high potential prospects, opportunities for establishing the country as a top producer while making high returns on investment are high.”
It added that investment from global energy giants would be essential for exploration.
“First on the agenda will be the return of global energy majors, specifically including Shell and ExxonMobil, both of which declared force majeure but paid $1.7 million to lease offshore blocks for the next 30 years. The return of these majors will be key for unlocking a new era of hydrocarbon exploration in Somalia.”
AEC believes that with a large portion of the nation's offshore basins yet unexplored and previously obtained seismic data indicating high potential prospects; there are many options to establish Somalia as a top producer while generating high investment returns.
“In 2022, the country has made steady progress towards stability, owing largely to recent regulatory reforms and political cooperation, and as global demand for African oil and gas increases, Somalia has emerged as a highly attractive investment destination. “
Exploration in Somalia has been slow despite its geographic proximity to nations with abundant hydrocarbon reserves; this is primarily due to political unrest and a lack of sufficient funding. Nonetheless, experts believe profitable opportunities exist in Somalia across the entire energy spectrum and value chain.