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Energy and natural resources

The US joins Somalia’s oil fray

As the United States joins the current scramble for oil in Somalia, it is broadening its role from being primarily a political and security actor to an economic one as well. The focus is shifting from Somalia as one battlefield in the war against global terrorism to a specific partisan interest. The frontline is the South West State of Somalia, bearing the largest petroleum deposits in the country. However, the US engagement in Somalia occurs in the midst of divisive domestic politics, blurring what is a national policy of the Administration and what are self-interested efforts within the bureaucracy.

Before the Somali state collapsed in 1991, oil blocks in and around Somalia had been licensed to major oil companies and their subsidiaries, including British Petroleum (BP), Royal Dutch Shell (Pecten), Italian ENI (Agip) and French Total (for offshore evaluation). Some two-thirds of the oil map was awarded to US firms, including ConocoPhillips, Amoco (now BP) and Chevron. After 1991, despite the absence of a Somali government, these major companies continued to assert their concession interests.

Coinciding with the declared end of the transitional period in Somalia and international recognition of central government in 2012, a new competition for petroleum resources was triggered at both the federal and regional levels. Most obviously, the newly elected President, Hassan Sheikh Mohamud, signed a privileged deal with Soma Oil in August 2013. Meanwhile, Somaliland and Puntland signed separate deals with companies from a range of countries, causing tensions with the Federal Government over who has authority to issue such contracts.

These tensions continued during the process of establishment of the Federal Member States of Galmudug, Jubaland, South West and Hirshabelle. Foreign oil interests became involved in the state-formation process, seeking agreements with political outcomes. Funds came through both official development assistance as well as direct support from private companies. For example, during the Galmudug presidential elections in July 2015, Arizona-based Liberty Petroleum unsuccessfully supported the incumbent, General Abdi Hasan Awale (Qaybdiid). They had been vastly outspent by President Hassan Sheikh, who reputedly used $9 million of security sector salaries to ensure the election of his security minister, Abdikarim Hussein Guled. The formation of the resulting Interim Galmudug Administration had been supported by some 5 million pounds sterling from the Somalia Stability Fund.

Meanwhile, in South West State, the United Kingdom invested heavily, visibly in the security sector and in the port city of Barawe, restricting the role of other donors in the area and particularly the US, setting the terms of a later confrontation. Separately, then South West President Sharif Hassan Sheikh Aden had awarded two contracts to US Blackwater founder Erik Prince, working with the United Arab Emirates, which were focused on Barawe and with an eye to future oil developments. Erik Prince is known to be close to the US Administration, in which his sister, Betsy DeVos, is the Education Secretary. There is currently an effort underway by the Federal Government of Somalia to cancel these two contracts.

As oil exploration activities were undertaken across Somalia, and offshore and onshore surveys completed, the oil wealth of Somalia became increasingly apparent. It was estimated that billions of barrels of oil worth hundreds of billions of dollars would put Somalia in the order of the sixth or seventh largest oil producer in the world. Many of the oil companies openly operating in Somalia were either assuming risks on behalf of larger companies or independently making political arrangements with compromising production sharing agreements for resale. Regardless, they were paving the way for the direct reengagement of the major corporations.

In 2018, several events occurred. In July, the US appointed a new Ambassador to Somalia, Donald Yamamoto. In September, United Nations Secretary-General António Guterres appointed Nicholas Haysom as a new Special Representative for Somalia. This followed the post having been held twice by the United Kingdom. In November, Sharif Hassan resigned as President of South West State as the electoral race for the regional leadership was underway. Of the two frontrunner candidates, one was Sheikh Mukhtar Robow, a founding member of the jihadist group Al-Shabaab and locally popular with his dominant clan. The other, backed by the Federal Government, was Abdiasis Mohammed “Laftagareen”, a former Member of Parliament and Federal Minister.

To protect its investments in South West State and to ensure political support of exploitation of the significant oil resources discovered, the United Kingdom was viewed on social media to be aligned with the likely winner of the election, Mukhtar Robow. The UN’s Special Representative, Haysom, was perceived to be biased in favour of the UK alignment, effectively drawing the UN into a one-sided role in the political process.

In opposition to this line up, the US, Ethiopia and the Somali Federal Government did not want a Robow win. They considered the options of convincing him to step down as a candidate, or arresting him if he did not. Robow refused to withdraw, he was arrested, violence broke out, and Laftagareen became the new President. The resulting hostile relations between the UN and the Somali Federal Government, as the face of a deeper set of tensions, fatefully led to the expulsion of Haysom from Somalia as what some termed a “sacrificial lamb” for the US entry into South West State politics and therefore access to the newly found resources.

The US Ambassador, Yamamoto, quickly asserted a new set of political relations with the Federal Government and in South West State to enable resource relations to develop. He exploited the US nationality of Somali President Mohamed Abdullahi Mohamed “Farmajo” to coerce him, while betting on the viability of Somali Prime Minister Hassan Ali Khaire and his petroleum relations. In South West State, Yamamoto has sought through the new authorities to expand a US security footprint in strategic proximity to oil reserves. Meanwhile, the US has rebuffed UK efforts to use the existing Baledogle military base.

Yamamoto’s expansion into South West State is risking for the US a provocative involvement in local clan politics in oil rich areas. It is currently a perception of the powerful Hawiye clan that Yamamoto is siding with minority clans against the Abgaal and Habr Gedir subclans of the Hawiye located in the Lower Shabelle area of the State. If this issue is not managed more carefully, it could well destabilize South West State to Al-Shabaab’s advantage.

It is also not clear whether this is all an official US policy or a more independent initiative. Yamamoto was a senior official in the US State Department, and as a Democrat he was a close ally of Hillary Clinton, like his predecessors and former appointees James Swan and Stephen Schwartz. Though isolated in a Republican Administration, it was still surprising that Yamamoto chose for himself the lesser ambassadorship to Somalia. It is of some speculation whether doing so was in aid of a personal exit strategy in the event of establishing a going oil concern he could subsequently join. What is less ambiguous is that many of these activities in Somalia are flying under the Administration’s radar screen, in fear that President Donald Trump might make a rash decision withdrawing US involvement in Somalia.

The question now is to what extent will political, security and aid imperatives of the United States and other international engagement in Somalia be subordinated to the logic of securing control over petroleum resources. Will destabilization of the country be an acceptable price to pay for the prospect of foreign exploitation of these resources? The Somali population is likely to be the loser again. Will also Al-Shabaab gain support from within Somali’s given the US’s expansion role in the Somalia politics and other international bodies?


By: Abdirahman Omar

This article was first published by Caasimada.

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