By Eng Mohamed Ali Mirreh

Few issues have polarized Somalia’s political and economic discourse as sharply as recent oil discoveries. Government officials hail them as a historic breakthrough capable of transforming the nation’s fortunes, while critics dismiss the excitement as politically motivated hype detached from reality.

The truth lies somewhere in between: Somalia’s geological potential is genuine, but promises of immediate prosperity are overstated. The central question remains—are Somalia’s oil finds an overhype or a game changer?

Concrete Steps Toward Exploration

Somalia has undeniably moved beyond speculation into tangible exploration. Turkish research vessels conducted advanced 3D seismic surveys in 2024–2025, confirming promising geological structures similar to those found in Yemen, Tanzania, and Mozambique. In April 2026, the Turkish drilling ship Çağrı Bey commenced Somalia’s first-ever offshore deep-water drilling at the Curad-1 site, marking a shift from being “data-rich but drill-poor” to actual exploration.

These efforts are backed by comprehensive agreements between Turkey and Somalia, with Turkey investing heavily in infrastructure and drilling operations. Such developments demonstrate serious financial and technical commitments to Somalia’s oil sector.

Persistent Uncertainties

Despite these advances, critical uncertainties remain. Seismic data, while encouraging, does not confirm commercially viable reserves, and estimates of over 30 billion barrels remain speculative. Even if oil is discovered, production could take years—some projections place the first output as late as 2034–2036. Mozambique offers a cautionary parallel: despite similar discoveries, its commercial production is still years away.

Moreover, reports of revenue-sharing agreements heavily favoring Turkey—up to 90%—have fueled criticism of exploitation and unfair deals. The fact that the agreement has never been scrutinized or approved by the Federal Somali Parliament raises questions about its legitimacy and fairness.

The March 2024 Agreement with Turkey

The oil exploration and production agreement signed in March 2024 between Somalia and Turkey’s state-owned Turkish Petroleum Corporation (TPAO) has become a lightning rod for controversy. Structured as a 10-year partnership, the deal grants Turkey exclusive rights to offshore and onshore exploration. Key terms include:

• Cost Recovery Cap (90%): TPAO can recover up to 90% of annual output as “cost petroleum,” far higher than Somalia’s typical 70% cap. This means Somalia will likely see little revenue in the early years.
• Royalty Rate: Somalia receives a fixed 5% royalty, disconnected from market fluctuations.
• Exemptions: TPAO is exempt from signature bonuses, production bonuses, and license fees, denying Somalia upfront income.
• Ownership of Proceeds: TPAO retains full rights to export its share of oil and keep revenues abroad.

Critics describe the deal as neo-colonial, arguing it erodes Somalia’s sovereignty and creates a monopoly. Dispute resolution is set in Istanbul rather than neutral arbitration, and Somalia must compensate Turkey if future Somali laws increase operational costs. These provisions have been condemned as one-sided and detrimental to Somalia’s long-term interests.

Risks and Controversies

• Sovereignty Erosion: Outsourcing control of primary economic assets to a foreign nation undermines Somalia’s independence.
• Security Risks: Turkish naval and land forces may be deployed to protect operations, raising the risk of Al-Shabaab targeting logistical support.
• Internal Instability: The lack of consultation with Federal Member States threatens the 2018 Revenue Sharing Pact and risks deepening political divisions.
• Financial Risks: With the 90% recovery cap, Somalia could receive negligible financial benefit for years, even if oil is found.

Who Benefits?

For ordinary Somalis, the likelihood of benefiting from oil wealth is slim. Rampant corruption ensures revenues will be siphoned off through kickbacks and opaque contracts. Political overhyping serves to dwarf opposition voices and secure short-term gains for the ruling elite. Weak institutions further diminish the chances of transparent revenue management or equitable distribution. Oil wealth risks enriching elites while leaving citizens excluded.

Global Energy Transition

Somalia’s timing is problematic. According to the IEA’s World Energy Outlook 2025, fossil fuels still supply about 80% of global primary energy, but growth in demand is slowing. Oil consumption is projected to plateau before 2030 under current policies, with declines accelerating under stronger climate action scenarios. At the same time, renewable energy is expanding at record pace—solar and wind account for the majority of new electricity capacity worldwide.

Electric vehicles, electrification of industry, and clean energy investment are reshaping long‑term demand patterns. Somalia risks entering the oil market just as global consumption stabilizes and prices face downward pressure, reducing the future value of its reserves compared to earlier decades.

Charting the Path Forward—anchoring Somalia’s future in sustainable progress rather than being overtaken by uncertain oil prospects.

Somalia’s oil and gas potential is real, but it is not the immediate game changer the government portrays. Proven reserves and commercial production remain uncertain, timelines are long, and corruption threatens to prevent ordinary citizens from benefiting. To avoid the “resource curse,” Somalia must temper expectations, strengthen institutions, and ensure transparent governance. More importantly, the country should channel its energy into sectors where immense opportunities already exist—agriculture, fisheries, and livestock—industries that can deliver jobs, food security, and export revenues far sooner than oil.

Preparing for a global energy future less dependent on fossil fuels is essential. Only by prioritizing good governance, sustainable development, and diversification can Somalia ensure that its natural wealth benefits the people rather than a corrupt elite.

Eng Mohamed Ali Mirreh
Email: m.mmirreh@gmail.com