* Neighbours at odds over where boundary sits in Indian Ocean
* Total, Anadarko have licensed blocks in the region
* East, Horn of Africa hot spots for oil, gas exploration
By Kelly Gilblom
NAIROBI, April 20 (Reuters) - A row between Kenya and Somalia over their
maritime border may deter multinational oil companies from exploring for oil
and gas offshore east Africa, and a Somali official warned that the argument
could escalate.
The two coastal nations disagree over the location of their boundary line in
the Indian Ocean. At stake are their legal claims to sell rights for
exploration and collect revenue from any discovery.
Kenya recently identified eight new offshore exploration blocks available
for licensing, and all but one of them are located in the contested area.
"The issue between Somalia and Kenya is not a dispute; it is a territorial
argument that came after oil and gas companies became interested in the
region," Abdullahi Haji, Somalia's minister of foreign affairs, told Reuters
in Mogadishu.
"If the argument continues unsolved, it will change into a dispute that may
result at least in souring the deep relation between our two countries and
(cause a) war at last," he said.
East Africa has become a hot spot for oil and gas exploration, spurred by
new finds in waters off countries including Uganda, Tanzania and Mozambique.
In the Horn of Africa, Somalia's semi-autonomous Puntland and Somaliland
regions have also licensed exploration blocks.
Kenya announced its first oil discovery in March by British oil firm Tullow
Plc, which was on land.
The row between Kenya and Somalia threatens to upend some exploration rights
that Kenya has granted to oil and gas companies, which have already started
exploring in the area.
French firm Total and Texas-based Anadarko and the only two companies so far
holding licenses from Kenya to blocks in the disputed area. They have no
immediate plans to drill there. Both companies declined to comment on the
border issue.
UN INTERVENTION?
Martin Heya, Kenya's petroleum commissioner, said he was confident the
United Nations, which could be requested to help delineate the border, would
agree with his country's view, and he expected companies to continue their
exploration activities.
"Do you stop working just because the boundaries have not been determined?
No," he told Reuters.
Consultants involved in border demarcation said the two countries won't have
a legitimate boundary until they sign a treaty that delimits the border, but
that is unlikely to happen until Somalia has a stable government.
Heya says the maritime border between the two countries should run
horizontally east from the point at which the two countries touch on land.
The practice in east Africa has been for boundaries to run along the line of
latitude, Heya said.
"For the time being, this is where we believe the border should be," he
said, referring to the horizontal east-west maritime border.
Somali officials say the onshore border continues into the ocean diagonally
southeast and that a horizontal border would be unfair.
If the Somalia-Kenya border was continuous from land into the ocean, making
it lie diagonally from the northwest to the southeast, Kenya would be left
with a small triangle in the Indian Ocean over which it could claim mineral
rights.
Kenya has had stable diplomatic relations with its war-torn neighbour, but
the east African economic powerhouse sent troops into Somalia last October
in pursuit of al Qaeda-linked al Shabaab rebels, accusing the militants of
cross-border attacks on its territory.
UNSTABLE SOMALIA
Joshua Brien, a legal adviser with the Commonwealth Secretariat, who has
consulted with Kenya on maritime border matters, said the two countries
won't have a legitimate boundary until they write and sign a treaty.
The absence of a stable government in Somalia could hinder this process, he
said.
Somalia's government has been battling an insurgency by al Qaeda-linked
rebels for years and barely controls the capital, even with the help of an
African peace-keeping force executing a U.N. mandate to prop up its
Western-backed government. It is unlikely it would have the ability to wage
a war on Kenya.
Brien also said the two countries' border disagreement is not unique.
Throughout the world there are unresolved maritime boundaries.
"It is not uncommon for maritime boundary issues to become heated,
especially where petroleum exploration and development is concerned," he
said.
"In the case of Somalia, the matter is exacerbated by the governance and
offshore security situation in that country, both of which are well known."
Kenya is pushing on with oil and gas exploration, but petroleum commissioner
Heya acknowledged the border dispute could cause problems in the future.
Heya said companies will be unable to drill in their respective blocks until
the boundary is settled, because it will be unclear where to direct revenue
from a resource discovery.
"Where the revenue goes is not apparent," Heya said.
C Thomson Reuters 2012 All rights reserved
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Received on Fri Apr 20 2012 - 10:16:51 EDT
