Marathon, PETRONAS, and PexCo Oil and Somalia

More information on the Somalia, Oil, and possibly TopCat continue. Reporting from Oil and Gas Investor indicates Marathon Oil, of Texas, and possibly other firms have taken over the Conoco claims, or at least is moving in on them, and bumping yet another company to boot.

From the Nov 2005 issue, emphasis added:

4. Mixed messages are being sent about licensing in Somalia with a Dutch firm taking acreage but an Australian firm, which thought it had won a block, being told it had negotiated with the wrong people. [Dutch] PexCo exploration has signed up for with the Ministry of Mines and Energy for exploration in the Ogaden area, according to reports in Ethiopia. The company has taken the Ferfer and Abred blocks covering 18,546 sq miles (29,865 sq km) and has agreed to spend US $5 million in the initial term.

However, Range Resources [an Australian firm] has had its claim over the Puntland region put in doubt. Somali Prime Minister Ali Mohamed Gedi said the deal with the regional government was invalid as only the country's transitional federal government could negotiate the sale.

Rangeresources_02122005 This contradicts Range’s statement on its website (picture at left in case site changes) that it received in written approval for the deal from the Somali government. Gedi had said that foreign companies and investors that local administrations could not legally negotiate contracts over natural resources.

“Foreign companies should desist in attempts to deal with local authorities ... without prior written consent from the federal government,” he said.

On 19 October 2005 it was announced Petronas (Malaysian) and PexCo (Dutch) (More here and also here, but very little on PexCo), had signed deals with the Ministry of Mines, giving them rights to some of the same regions as Range, also reported on 15 November 2005.

On 6 October 2005, Range Resources eyed "Puntland as one of the remaining under-explored areas in the world that has a high potential for vast reserves of hydrocarbons." Their PowerPoint presentation [also stored locally here] indicates a positive co-operative relationship with the indigenous population, with the intent

to facilitate the exploration and commercial development of the State’s natural resources (farm in, joint venture) to bring the commensurate benefits to the people of Puntland and shareholders of the Company

Range believes this is possible because the "Political situation in Puntland is stable with a respected President with no civil unrest like that currently affecting Mogadishu".

The logical, but possibly coincidental, connection is with the Australian / Canadian HAZFA partnership (read more here). The Range Resources Code of Conduct, prominently available on their website, is clear and straight-forward. The Marathon Oil Code of Conduct, has a different feel and tone. Much of this difference is undoubtedly the result of Marathon's far greater size.

The cooperative agreement signed between Somalia and Ethiopia on 1 Dec 2005 came with pledges of assistance to calls "upon the international community to extend financial and political support to the transitional government and take measures on those forces who attempt to hamper peace in Somalia" [emphasis added]. Further, the "African Union, European Union, UN, World Bank and other donors pledged for their continued support to the Transitional Government of Somalia."

It seems maybe some oil resource competition is happening. Is there payback for Malaysia for its assistance in GWOT (PETRONAS is wholly government owned)? Or is there something else because of a Chinese connection (PETRONAS contracted Zhongyuan Petroleum Exploration Bureau)?

The Zhongyuan Petroleum Exploration Bureau (ZPEB), a powerful subsidiary of China's second largest national petroleum consortium, the China Petrochemical Corporation (SINOPEC), appears to be the principal oil firm operating in Gambella at present, under subcontract to Malaysia's national oil company PETRONAS. The base camp for ZPEB equipment and petroleum explorations is located approximately 1.5 kilometers from the center of Gambella town on the Abobo-Gambella road. The Ethiopian site manager, Mr. Degefe, is a highlander who tersely describes himself as "responsible for making all operations and security." The base camp is under tight security and heavily guarded by EPRDF troops. PETRONAS and the China National Petroleum Corporation currently operate in Sudan. A recent report by Human Rights Watch raises charges that the Asian oil giants have provided cover for their respective governments to ship arms and military equipment to Sudan in exchange for oil concessions granted by Khartoum.

If this last item is a critical piece of the puzzle, then getting back to the original story about TopCat is about USG counters against China and not about US oil interests directly, but blocking Chinese? If so, then again, why pick TopCat??

Is this why Rumsfeld has asked the IG probe Feith and the Pentagon? The IG is a direct report to the SecDef and if Feith was working for Rumsfeld, why would he call this? As CYA if something blows up? Or, here's the Black Helicopter version (are no more Black Helicopters since FEMA has been gutted?): Rumsfeld calls the IG probe to placate Congress as cover for another internal investigation that he is not happy with? There are serious differences between the civilian elite and military elites.