Kenya, Somalia border row threatens oil exploration

A worker at the Ngamia 1 oil rig in Turkana County. A row between Kenya and Somalia over their maritime border may deter multinational oil companies from exploring for oil and gas offshore east Africa, and a Somali official warned that the argument could escalate. File 

By Reuters

In Summary

• Neighbours at odds over where boundary sits in Indian Ocean
• Total, Anadarko have licensed blocks in the region
• East, Horn of Africa hot spots for oil, gas exploration

A row between Kenya and Somalia over their maritime border may deter multinational oil companies from exploring for oil and gas offshore east Africa, and a Somali official warned that the argument could escalate.

The two coastal nations disagree over the location of their boundary line in the Indian Ocean. At stake are their legal claims to sell rights for exploration and collect revenue from any discovery.

Kenya recently identified eight new offshore exploration blocks available for licensing, and all but one of them are located in the contested area.

"The issue between Somalia and Kenya is not a dispute; it is a territorial argument that came after oil and gas companies became interested in the region," Abdullahi Haji, Somalia's minister of foreign affairs, told Reuters in Mogadishu.

"If the argument continues unsolved, it will change into a dispute that may result at least in souring the deep relation between our two countries and (cause a) war at last," he said.

East Africa has become a hot spot for oil and gas exploration, spurred by new finds in waters off countries including Uganda, Tanzania and Mozambique. In the Horn of Africa, Somalia's semi-autonomous Puntland and Somaliland regions have also licensed exploration blocks.

Kenya announced its first oil discovery in March by British oil firm Tullow Plc, which was on land.

The row between Kenya and Somalia threatens to upend some exploration rights that Kenya has granted to oil and gas companies, which have already started exploring in the area.

French firm Total and Texas-based Anadarko and the only two companies so far holding licenses from Kenya to blocks in the disputed area. They have no immediate plans to drill there. Both companies declined to comment on the border issue.

UN intervention?

Martin Heya, Kenya's petroleum commissioner, said he was confident the United Nations, which could be requested to help delineate the border, would agree with his country's view, and he expected companies to continue their exploration activities.

"Do you stop working just because the boundaries have not been determined? No," he told Reuters.

Consultants involved in border demarcation said the two countries won't have a legitimate boundary until they sign a treaty that delimits the border, but that is unlikely to happen until Somalia has a stable government.

Heya says the maritime border between the two countries should run horizontally east from the point at which the two countries touch on land. The practice in east Africa has been for boundaries to run along the line of latitude, Heya said.

"For the time being, this is where we believe the border should be," he said, referring to the horizontal east-west maritime border.