The new law sets out ownership, revenue sharing, and environmental rules for Somalia's petroleum resources.
Somalia has enacted Law No. 19, the Petroleum Law of the Federal Republic of Somalia. The law establishes the framework for developing and managing the country's oil and gas resources.
The Act was enacted as Somalia works to develop its natural resources responsibly. Its purpose is to set clear rules on ownership, revenue sharing, and environmental protection so that petroleum development benefits the nation and respects the rights of communities.
Law No. 19, the Petroleum Law of the Federal Republic of Somalia was enacted and entered into force on February 8, 2020.
The development of oil and gas can transform an economy, but it requires careful rules to ensure the benefits are shared and the risks managed. This law was designed to provide that framework for Somalia.
Article 4 (Ownership of Petroleum) provides that petroleum resources are a national asset owned collectively by all Somali people, establishing a clear principle of public ownership.
Article 6 (Sharing of Petroleum Revenue) provides that petroleum revenue is shared between the Federal Government and the member states, reflecting Somalia's federal structure.
The law addresses existing arrangements. Article 9 (Petroleum Agreements Signed Before 1991) sets out how older agreements signed by foreign companies are to be treated.
Environmental responsibility is built in. Article 11 (Environmental Protection) requires companies holding petroleum licences to protect the environment in the areas affected by their activities.
This law is important because it gives Somalia a clear framework for developing its petroleum resources. Public ownership, revenue sharing between federal and state governments, and environmental obligations help ensure that resource wealth benefits the nation and respects communities. A transparent framework also attracts responsible investment in the sector.
“Petroleum resources are a national inheritance that must be managed transparently and shared fairly. By affirming public ownership, setting revenue-sharing rules, and requiring environmental protection, this law gives Somalia a sound basis for resource development. Careful implementation and genuine revenue transparency will be essential to its success.”
, Dr. Abdiwahid Osman Haji, LL.M. (Master of Laws), LL.B. (Bachelor of Laws)
Managing Partner at Mogadishu Law Office
This release is provided for general information and does not constitute legal advice. Professional legal advice should be obtained before acting on any matter discussed here.