Fight over oil revenues would harm Somalia peace

Somalia’s embattled central government will not argue with semi-autonomous Puntland over potential oil revenues for fear of scuttling a fragile peace process, but a top official said on Monday the law made clear control lay with Mogadishu.Canadian firm Horn Petroleum, majority-owned by Vancouver-listed Africa Oil Corp., and its exploration partners started drilling in March in Puntland’s Dharoor Block but have yet to announce any proven reserves.Africa Oil and joint venture partners Range Resource Ltd. (RRS.AX) and Lion Energy entered into production-sharing agreements for the Dharoor Valley Exploration Area and the Nugaal Valley Exploration Area directly with Puntland, bypassing Mogadishu which is grappling with an Islamist insurgency.“Our policy is to let the oil come first rather than now going to Puntland and making our point,” Deputy Minister of Energy Abdullahi Dool told Reuters.“Because of the situation between different regions, we don’t want to push anyone to the wall. We don’t want to make too many Somaliland situations where regions want to break away,” he said in an interview.Dool was referring to the northern breakaway enclave which declared independence in 1991 but is not internationally recognised.“First of all let there be oil. You can’t fight when everything is underground,” said the minister, whose portfolio also includes water, petroleum and mineral resources. Somalia’s interim federal government is tasked with adopting a new constitution by August, aimed in part at redefining the relationship between Mogadishu and the regions and ending a two-decade cycle of violence.