Only an international road show has been organised so far to promote the Tour of London in March and the next one is not scheduled in Houston until the end of September or the beginning of October. Ahmed says the timetable has slipped because the ministry has focused on passing the oil law. Spectrum Geo, the company that distributes 2D seismic data for licensing blocks, has so far shown data to about 20 companies, Ahmed says. The production sharing model for the blocks will be detailed in the coming months. The size of the geological structures identified offshore means that they are easily billion barrel fields when they contain hydrocarbons. They suggest that Somalia could become one of East Africa`s largest oil games upstream, with up to 30 billion barrels, which, if true, would be truly transformative for our country. However, it is also important to note that if commercial oil is discovered, production and therefore revenue sharing will be at least eight years away. Efforts have also been made to resolve open disputes with existing stakeholders in the outer sea zone of Somalia to pave the way for good future relations with industry. Oil Minister Abdirashid Mohamed Ahmed confirmed to reporters at a briefing in London on 28 June that the ministry had signed an agreement with operator Shell and its partner ExxonMobil on historic commitments such as surface rents for large-scale offshore blocks built during the civil war. The country seems to have the geology, it has put in place the necessary legal and regulatory framework and has shown a determination to share revenues fairly. Great things like an Exxon/Shell joint venture have already shown interest. Somalia proposes production-sharing agreements for upstream oil activities.
After years of instability, the government has launched its first round of offshore licensing, which will continue until 2020. New legislation to accompany the cycle is awaiting adoption by Parliament. When the new legislation comes into force, a levy of between 5% and 35% and a for-profit profit-sharing mechanism would be put in place. Additional legislative uncertainties remain, while constitutional updates have not yet been updated. Contracts signed before 1991 should be renegotiated under the new conditions. A successful renegotiation should set the tone for future investments in this area. At the end of last month, we also gladly signed an agreement with Shell and ExxonMobil, which made historic commitments and introduced a roadmap to transform concessions into production-sharing agreements (“PSAs”). We are at the beginning of a path that could be essential to sustainable development and poverty reduction, as well as to the development of stable state and civil institutions. As part of the management of oil ownership and the allocation agreement with the country`s constituent states, mineral and natural resources are transferred to the Somali people and future oil and gas revenues will have to be distributed among the federal government, the six constituent Member States and their local communities.