Somalia and Turkey may struggle to realise oil deal

Significance The deal builds on the recent ten-year agreement on maritime defence cooperation. Somalia is believed to have significant onshore and offshore oil and gas potential. However, investors have so far declined to pursue this opportunity due to the unstable security and regulatory environment. Impacts The deal offers another lever to assert administrative dominance over Somaliland in key sectors such as hydrocarbons and aviation. If Turkey allocates exploration resources to Somalia, it could encourage other previously reluctant actors to follow suit. Tensions over revenue sharing will re-emerge between federal and regional administrations.