Invasion of Somalia a boon for big oil

By Norm Dixon, Green Left Weekly, 27 January 1993

Four giant US oil companies stand to make a killing in Somalia if US troops can pacify the strategic African nation, the Los Angeles Times has revealed. The report further undermines US claims that the invasion was a “humanitarian mission” rather than one to defend US military and economic interests in the region.

The report, which appeared on January 18, revealed that almost two-thirds of Somalia was allocated to the oil giants Conoco, Amoco, Chevron and Phillips by the pro-US dictator Mohamed Siad Barre. Barre was overthrown in January 1991.

It seems a significant motive behind the decision of US President George Bush, a former Texas oil magnate, to send troops to Somalia may have been protecting the oil industry's multimillion-dollar investments there.

The LA Times revealed that Conoco, the only major multinational corporation to maintain a functioning office in Mogadishu since 1991, allowed its Mogadishu corporate compound to be transformed into the de facto US embassy before US Marines landed in the capital. The president of the company's subsidiary in Somalia served as the US government's volunteer “facilitator” before and during the intervention.

“They sent all the wrong signals when [US special envoy Robert] Oakley moved into the Conoco compound”, an expert on Somalia who worked with one of the four companies in the late 1980s told the LA Times.

“It's left everyone thinking the big question here isn’t famine relief but oil—whether the oil concessions granted under Siad Barre will be transferred if and when peace is restored. It's potentially worth billions of dollars, and believe me, that's what the whole game is starting to look like.”

According to Thomas O’Connor, principal petroleum engineer for the World Bank, who headed a three-year study of the oil prospects in the Gulf of Aden, off Somalia's northern coast, Somalia's oilfields have “high [commercial] potential … once the Somalis get their act together”.

In 1991 a World Bank-coordinated study, geologists put Somalia and Sudan at the top of the list of eight prospective commercial oil producers.

In 1986, Conoco, Amoco, Chevron, Phillips and, briefly, Shell obtained exploration licences for northern Somalia from Siad Barre's government. Somalia was carved up into concessions, with Conoco, Amoco and Chevron winning the right to explore and exploit the most promising ones. The companies' interest in Somalia was sparked by the mid-’80s discovery of an estimated 1 billion barrels of oil across the Gulf of Aden in Yemen. Geologists believe those reserves are part of a great field that extends into and across northern Somalia.

The Yemeni operation now yields nearly 200,000 barrels of oil a day. Then vice president George Bush was on hand to officially open the Texas-based Hunt Oil Corporation's refinery in Yemen in April 1986. In his speech, which concluded a 10-day Middle East tour, Bush stressed “the growing strategic importance to the West of developing crude oil sources in the region away from the Strait of Hormuz”. The Strait of Hormuz controls access to the Persian Gulf and its vast oil reserves.

United Press International reported soon after: “Throughout the course of his 17,000-mile trip, Bush suggested continued low [oil] prices would jeopardise a domestic oil industry `vital to the national security interests of the United States', which was interpreted at home and abroad as a sign the one-time oil driller from Texas was coming to the aid of his former associates”.

Since the US invasion of Somalia on December 9 little has been said in public about Somalia's potential for oil and natural gas production.