Somalia Signs Hydrocarbon Exploration Deal With U.S. Firm

(Bloomberg) -- Somalia has signed a deal with Coastline Exploration Ltd. to search for hydrocarbon offshore that it expects to generate millions of dollars in revenue.

The seven production-sharing agreements with the Houston-based oil and exploration company are the “first milestone necessary” for the development of the nation’s hydrocarbon industry, the ministry of petroleum said in a statement. 

Exploration is expected to start soon, Petroleum Minister Abdirashid Mohamed Ahmed said, without providing a timeline.

The discovery of gas would be a big boost for the low-income nation that is struggling to rebuild after more than 20 years of civil war and is still battling an insurgency by al-Shabaab, an al-Qaeda affiliate.

Prices of oil and gas have surged this year fueled by supply chain bottlenecks and production woes among producers. 

No oil and gas wells have been drilled in the Horn of Africa since 1991, according to the statement. 

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