17 Dez Somalia Revenue Sharing Agreement
While the safety of potential investors should be a major concern, it should be noted that both seismic investigations were completed without a single incident. The federal government has adopted the state-to-state resource-sharing agreement, which ensures an equitable sharing of natural resource revenues among all Somali citizens. It is unique in the world, as more than a third of all revenues are distributed among our Member States in a process overseen by our central bank and the finance department. It will be up to our people to elect the representatives they think will invest most effectively and in the long term from their local communities. His Excellency Abdirashid Mohamed Ahmed, Minister of Oil and Mineral Resources, commented on the revenue-sharing agreement and said: “Our agreement on the sharing of oil revenues is unique in the world and provides by far the highest percentage of potential revenues to non-federal institutions in a comparable agreement. Member States will play a central role in allocating funds to the somali people as a whole. This will allow us to achieve equitable and equitable development across the country. Although it takes many years before production begins, if oil reserves are discovered, this agreement has the potential to change the lives of all Somalis. “Somali`s Petroleum Law was closed in February by legislative proceedings. An agreement on the distribution of revenues in the law defines the distribution of future revenues between the federal state, member states and municipalities. The agreement was tested with the first income from rents paid by Shell and ExxonMobil.
As part of the agreement, Shell-Exxon Somalia will pay approximately $1.7 million in cumulative rents for the period 1990-2018 and is working on a roadmap to transform the concessions previously agreed under the new oil law into production sharing agreements (EPIPs). None of these areas is part of the current licensing process. 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. An agreement between the Somali federal government and the country`s constituent states was considered essential to prevent the approval process from getting bogged down in the dispute over the distribution of potential revenues for future hydrocarbon discoveries between the central government and the states in the waters in which they are located. 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.