As the price of oil continues to trade at high levels, more and more explorers are expanding their geographical focus in the hope of discovering the perfect oil play. Companies are having to push beyond the traditional boundaries of oil safe havens and expand their efforts into uncharted territory. Nowhere is this more evident than the surge of interest in the East African country of Somalia.

In the 1860s, at the height of the colonial era, France acquired a foothold on the African east coast for what was later to become known as Somalia, or “the Horn of Africa.” A decade later, Britain proclaimed Somaliland a protectorate until 1888 when an Anglo-French agreement defined the boundary between British and French possessions. Further European presence was felt in 1889 when central Somalia was set up as an Italian protectorate. The largely divided country gradually obtained independence from protectorates between 1950-1960, while a section of the country, Somaliland, declared unilateral independence in 1991, remaining a functioning, but unrecognized, independent republic ever since.

Economic and geopolitical conditions

From a political aspect, Somalia is the very epitome of unsettled. Since the fall of Somalia's pro-US president, Mohamad Siyad Barre, in 1991, the country has been in a state of civil disorder. As a result of the absence of a central authority, tribal conflicts and a resurgent military has dominated the politics of the country.

After Somalia's independence in 1960, economic growth failed to keep pace with the rise in population caused by an influx of refugees, resulting in a heavy dependence on agriculture — which is frequently affected by droughts. The country's largest industry is processing of agricultural food products and there has been minimal industrial development. Except for tin, the country's minerals remain under-developed, although there has been increasing interest by international companies seeking to prospect for oil.

Source: The Street

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