Sterling Energy has an interest in Somaliland, a high potential exploration project. Sterling continues to identify and acquire new ventures, securing interests through direct licensing agreements, farming in or acquisition.
Onshore southwestern Somaliland
Genel 50% (Operator)
The Odewayne Block covers a very large area (circa 22,000km²) onshore southwestern Somaliland, located adjacent to the border with Ethiopia. The PSC covers block SL6 and part of blocks SL7 and SL10.
The PSC, awarded in 2005, is in the Third Period (expiring November 2018) with an outstanding minimum work obligation of 500km of 2D seismic. The minimum work obligation during the Fourth Period of the PSC (expiring May 2020) is for 1,000km of 2D seismic and one exploration well. Extensive fieldwork and a high resolution gravity and magnetic data acquisition programme have been completed.
The Government sponsored 2D seismic campaign of 1,000kms on the Odewayne Block was completed in August 2017. The campaign satisfied the minimum work obligation for the current third period, for which Sterling is fully carried by Genel for all costs. The Company expects initial results late Q4 2017 and will thereafter undertake its own technical evaluation of the data.
Somaliland has seen very little historical exploration activity principally due to a long history of conflict. The region has been highlighted as a potential oil province due to its similarities to the productive rifts in Yemen and the presence of localised oil seeps.
The Odewayne Basin is an east-west trending rift basin believed to be of Jurassic to Cretaceous age. Gravity and magnetic data indicate the presence of a deep basin analogous to oil producing basins in Yemen and to the Nogal and Darhoor rifts which have been the focus of recent exploration interest in the region. The Odewayne basin is considered to be sufficiently deep for source rocks to be mature for oil generation and extensive oil seeps have been observed on block indicating a working hydrocarbon system. Jurassic and Tertiary clastic and carbonate reservoir rocks are seen at outcrop and in wells in the region with excellent quality Cretaceous reservoirs also thought to be developed. No seismic data has been acquired to date and the Block remains undrilled but the scale of the basin and comparison with analogue basins suggests potential for developing a significant portfolio of potentially drillable structures. Operator estimates of the potential of the basin are in the order of 1Bn bbls.
Background on Somaliland
Somaliland is situated in the Horn of Africa and was, until 1960, a protectorate of the United Kingdom. After gaining independence in June 1960, the State of Somaliland united with the Trust Territory of Somalia, formerly a colony of Italy, to form the Republic of Somalia. The government of the Republic of Somalia was ousted in a coup in 1969 and replaced by a military government which was itself forced from power by a coalition of armed opposition groups in the early 1990’s, leading to civil war.
The local government in Somaliland declared independence from the Republic of Somalia in May 1991 and has, since then, developed the institutions and structures of democratic government. The government of Somaliland is headed by the Executive Branch, which consists of a directly-elected President, a Vice President, and a Cabinet nominated by the President and approved by Parliament. The Parliament of Somaliland is the legislative branch of government and consists of two houses, the House of Elders and the House of Representatives, each with 82 members.
Although not officially recognised as an independent country, Somaliland maintains political contacts with its neighbours Ethiopia and Djibouti, and a number of international countries, including the United Kingdom.