Shell, Exxon Mobil pay $1.7 million for Somalia Oil blocks lease

The Royal Dutch Shell and Exxon Mobil have paid a whopping $1.7 million for Somalia's oil blocks after months of intense negotiations, Garowe Online reports.

According to Somali Deputy Minister of Petroleum And Mineral Resources, Mohamud Abdulkadir Hilaal, the two giant oil and gas firms reached an agreement, effectively allowing them to take over Somalia's offshore oil blocks for 30 years.

"After 30 Years Shell and Exxon Mobil paid the first Installment $1.7 Million Rental Service Fee for their Oil & Gas Blocks In Somalia," said Hilaal.

The deputy minister further added that the Management of this Money will be guided by the newly Resource Sharing Model signed by the Federal Government of Somalia and the Federal Member States In Baidoa city last year.

Somali controls one of the longest sea coastline in Africa, which is rich in oil deposits. However, civil war has paralyzed the country since the toppling of Siad Barre in 1991.

Prior to the coup, Shell and Exxon Mobil owned a joint venture of oil deposits in Somalia. There have been efforts to restore the business but the unfriendly environment made it technically impossible for decades now.

In June this year, Financial Times reported that the two companies were in the process of acquiring oil deposits in the Horn of Africa Nation. The reports were confirmed by the country's Petroleum Minister Mohamed Ahmed.