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Somalia president signs new petroleum bill into law

February 11/2020

MOSCOW (MRC) -- Somali President Mohamed Abdullahi Farmajo has signed landmark petroleum legislation into law to help open up a new frontier market, reported Reuters with reference to the oil ministry's statement.

The upper house of Somalias parliament in January approved the petroleum law aimed at providing a regulatory framework that will help attract investment in exploration by major oil companies.

"The Petroleum Law demonstrates the capacity of the Somalian people to unite in an historic effort to work together to build an equitable, prosperous and peaceful nation," Farmajo said in a statement.

The new law establishes revenue-sharing between the central government and states as well as a legal framework for an industry the country hopes will bring jobs and investment after decades of conflict.

Plagued by civil strife, Somalia currently does not produce any oil but production could transform the economy as seismic data has shown there could be significant oil reserves offshore.

The government hopes the petroleum law will entice big oil companies like ExxonMobil and Shell to return to the country where they held legacy blocks from the 1990s.

Last October, the two companies paid USD1.7 million owed to Somalia for leasing these offshore blocks, although operations there remain suspended.

"The opportunities for the international exploration and development majors are enormous, with Somalia having the potential to become one of the most significant hydrocarbon plays in offshore East Africa," Abdirashid Mohamed Ahmed, the Minister of Petroleum and Mineral Resources, said in the statement.

We remind that, as MRC informed before, in September 2019, ExxonMobil announced plans to spend GBP140 million over the next two years in an additional investment program at its Fife ethylene plant, which has a capacity of more than 800,000 t/y.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,093,260 tonnes in 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments rose from both domestic producers and foreign suppliers. The estimated PP consumption in the Russian market was 1,260,400 tonnes in January-December 2019, up by 4% year on year. Supply of almost all grades of propylene polymers increased, except for statistical copolymers of propylene (PP random copolymers).

ExxonMobil is the largest non-government owned company in the energy industry and produces about 3% of the world's oil and about 2% of the world's energy.


mrcplast.com
Author:Margaret Volkova
Tags:PP, PE, crude and gaz condensate, PP random copolymer, propylene, ethylene, petrochemistry, Exxon Mobil, Shell, UK, Russia, Somali Democratic Republic.
Category:General News
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