Bridging Investment Gap in Somaliland

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Monday, April 2, 2012

Australia's Jacka farms into Somaliland oil block

HARGEISA, April 2 |(Reuters) - Australian oil explorer Jacka Resources has entered into an agreement with Petrosoma Limited to take a 50 percent equity stake in an oil block in a breakaway enclave of Somaliland, Jacka said on Monday.


It said the 22,000 square kilometre Habra Garhajis block -formerly known as block 26 - in southwestern Somaliland was expected to be similar in geology to basins in Yemen and Uganda where billions of barrels of oil reserves have been discovered.
Somaliland declared independence in 1991 and has enjoyed relative stability compared to the rest of lawless Somalia, which has been mired in conflict for two decades. However, although it has held a series of peaceful general elections, it remains unrecognised internationally.

"Jacka's management have held the belief for a long time that Somaliland holds great potential," Jacka's Chairman Scott Spencer said in a statement.

Under the terms of the agreement, Jacka will be the operator, the company said in a statement. The Habra Garhajis block comprises the whole of concession SL6 and parts of SL7 and 10.

Jacka will conduct a gravity survey and a minimum 500 kms of 2D seismic tests, it said.

In November, Somaliland's government said London-listed company Ophir Energy, Asante Oil and Prime Resources had signed deals under which they would have 18 months to explore, conduct seismic tests and identify wells.

Only 21 wells have been drilled in Somaliland, making it under explored even by the frontier standards of the region, where the oil and gas industries are in their infancy.

Kenya announced last week its first ever oil strike, although more drilling is needed to assess commercial viability. (Reporting by Mark Anderson; Editing by Richard Lough)

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