Somaliland: exploration in 'Africa's 55th state'

Until 2010, Hussein Abdi Dualeh worked as a simple project manager
in Los Angeles overse eing the use of natural gas as fuel for cars.
It was a natural progression given his downst ream engineering
experience and his career start in the UAE as a salesman out of high
sch ool, marketing lubricants for Abu Dhabi National Oil Company.
Those days are past. On a trip back to Abu Dhabi this month, Mr
Dualeh was feted at a ta ble of honour, knee to knee with Mohammed Al Hamli, the UAE Minister of Energy, and Ton y Hayward, the former BP
chief executive, in the heart of the luxurious Yas Viceroy hotel.
Later, after delivering one of the keynote speeches of the morning
to executives from the world's supermajors, he enjoyed a cruise
around the island before retiring to his suite
Such is the life of the new oil minister of Somaliland.
His rapid rise to power is a product of politics and the reemergence
of companies questing for oil and gas in a place that has yet to
secure its statehood. Like Greenland and Iraqi Kur distan, where
wildcatters are drilling deep for oil, Somaliland administers itself
by and larg e on its own, yet has not been recognised as a country by
the United Nations. Like them, it also hopes hydrocarbons can ease
its path to statehood.
"You know what really carries the day is not politics, it's
geology," said Mr Dualeh. "If the geology is good, all bets are
off."
Somaliland has ample history to overcome. In the late 1980s, Chevron
was drilling and Con oco laying airstrips thanks to oil concessions
granted by the central Somalian government, which included the
former Italian colony that today is known as Somalia and, to the
north, the former British protectorate that calls itself Somaliland.
In 1991, militias overtook the capital of Mogadishu and deposed the
government, sending Somalia into lawlessness and famine and leading
foreign companies to declare force maje ure. That year Somaliland
declared independence.
"We actually think of ourselves as the 55th state in Africa," said
Mr Dualeh, pointing out that companies operating there are publicly
traded in London and enjoy ample legal coun sel. "If you have a
company that has a lot of interests in Somaliland, for the safety of
thei r interests they would rather see a full state that they're
dealing with - so it will only hast en the day that we're being
recognised."
This time around, three independents have signed up to explore
Somaliland, the best know n of which is led by Mr Hayward - Genel
Energy, the Turkish operator in Kurdistan. Genel is to start
surveying next month and expects to drill its maiden well at the
start of next yea r, part of a regional exploration programme that
includes Morocco and the Ivory Coast.
"The challenge is given the very high quality assets in Kurdistan,
how do you replicate it a s you go outside?" said Mr Hayward. "Really
the only way to do that is through exploratio n, so what we were
looking for is frontier exploration opportunities where we thought
the re was a possibility of finding large fields."
No one knows how much oil could be underground, in part because the
exploration campai gns under the previous government were so brief.
Mr Dualeh estimates that reserves co uld be in the billions of
barrels, although he stops short of imagining a future with
million-barrel-a-day output and ascendancy to Opec.
Beyond exploration, he hopes to transform the port of Berbera - a
three-berth harbour th at today exports sheep and frankincense - into
an international fuel shipping hub, taking advantage of its
deepwater geology and proximity to the Asian maritime transit route.
A road and railway are also planned between Somaliland and Ethiopia,
with a pipeline for Ethi opian hydrocarbons under discussion. Hopes
are high for international companies such as DP World that could
invest millions of dollars to transform Berbera into a world-class
com mercial port.
The drive to industrialise Somaliland came about three years ago
with the arrival of a new president, who Mr Dualeh had served as US
campaign manager. (A substantial diaspora in America furnishes votes
and campaign funds.) The president then tapped him to lead the
energy ministry, where he remains the only petroleum engineer.
Mr Dualeh recalled working in the United States 20 years ago and,
from afar, following Ch evron and Conoco's short-lived exploration
campaign.
"They were drilling and I would read this in the papers and say, 'Oh
God, I wish I could be a part of this operation,'" he said. "And
guess what? I now have the whole thing in my han ds."
Source: The National
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