Oil Discovery in Somaliland

Somaliland announced the first oil discovery within its borders. The country’s Ministry of Energy and Mineral Resources announced the oil discovery was made in the Sallahey area in the Marodi-Jeh region. The ministry confirmed that a black liquid had spilled from a drilling site and after the necessary investigation, it was confirmed that the liquid was oil. 

First Oil Discovery 

The oil discovery is the first of its kind in Somaliland. Genel Energy, a company based in the United Kingdom stated it would launch more exploration and production projects to take maximum advantage of the oil discovery. The oil discovery comes soon after Genel Energy was warned against carrying out any oil exploration projects in Somaliland without permission from the Somalian government in Mogadishu. Somalia’s oil ministry released a stern statement aimed at Genel Energy in December 2022. It called Genel’s ambitions to exploit the oil in Somaliland illegal. The Ministry said it “categorically rejects Genel Energy plc’s claim to own petroleum rights in Somalia’s northern regions and calls upon Genel Energy plc to cease its illegal claim to own petroleum rights.”  

“Any authorization granted in violation of Somalia’s laws and regulations is unlawful and would be considered null and void,” the oil ministry said. Somalia’s claim that oil exploration projects in Somaliland without its permission would be a violation of its sovereignty. This claim comes from the fact that Somaliland was formerly a part of Somalia but separated from the country and claimed independence in 1991. According to Reuters, it is a relatively peaceful country when compared to Somalia. Somaliland has not received widespread recognition as a legitimate and independent country.  Somaliland called the statement from Mogadishu “meaningless.” 

The oil discovery in Somaliland is a positive development. Oil is a product in high demand and if well harnessed, it leads to the economic development of a country or region. The oil discovery could see a shift for Somaliland from a livestock-focused economy to more of an energy products focus.