Controversial 90/10 split agreement raises questions about deal terms
Turkey has struck oil gold in Somalia with discoveries estimated to contain up to 20 billion barrels of commercially viable crude, potentially revolutionizing both nations’ economic trajectories. The breakthrough findings across two pilot oil blocks represent a transformative moment in Turkey’s strategic play for East African energy resources, with a third block expected to yield commercial quantities by August.
The discoveries follow a controversial oil development agreement signed between the Somali government and Turkey last month that grants Turkey approximately 90% rights to oil and gas output. Under the unusual terms, Turkish entities are exempted from standard upfront costs like signature bonuses and administrative fees, while being allowed to recover up to 90% of annual production as “cost petroleum” before profit-sharing begins.
Somalia’s President Hassan Sheikh Mohamud has defended the arrangement despite criticism, emphasizing that Turkey was “the first to step up and show real commitment to invest” in Somalia’s untapped energy potential, estimated at up to 30 billion barrels of oil and gas reserves.
Source: horseedmedia.net
