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April 7, 2016

Update on Kenya and Somalia’s Maritime Dispute: Implications for Energy Companies


Somalia has brought its long-simmering maritime dispute with Kenya to the International Court of Justice (the ICJ). The ICJs treatment of the case will have important repercussions not only for Somalia and Kenya (and possibly neighboring Tanzania), but also for energy companies interested in exploiting East Africas offshore resources.

Somalia first brought the dispute to the ICJ on August 14, 2014, when Somalia filed an application with the international court to establish a single maritime boundary between Somalia and Kenya in the Indian Ocean, delimiting the territorial sea pursuant to the [United Nations Convention on the Law of the Sea (UNCLOS)] and customary international law. [1] According to Somalia, Kenya wants the maritime boundary between the two countries to extend as a straight line from the parties land boundary, along the parallel of latitude where the land boundary sits, through the territorial sea, Somalias proclaimed exclusive economic zone, and the continental shelf. [2] Somalia argues that the straight line violates UNCLOS Article 7 and that UNCLOS Article 15 instead requires the border between the territorial seas to be a median line and the border of the exclusive economic zone and continental shelf to be resolved in the three-step process laid out in Articles 74 and 83. [3]

On October 7, 2015, Kenya filed preliminary objections challenging the admissibility of Somalias application and the ICJs jurisdiction to hear the case. [4] Kenya reportedly argues that the two countries April 7, 2009 Memorandum of Understanding requires them to resolve their dispute through the United Nations Commission on the Limits of the Continental Shelf (the CLCS), not the ICJ. [5] On February 5, 2016, Somalia filed a response rejecting Kenyas bid for an out-of-court settlement and proclaiming that it would seek justice only at the ICJ. [6] With no further filings scheduled, the ICJ might rule on the preliminary objection later this year.

The ICJs resolution of the parties dispute will have ramifications for international energy companies that have contracted with Kenya to develop the disputed territory. In 2012, Kenya opened eight new offshore blocks for sale to corporations, including L-5, L-21, L-22, L-23, L-24, and L-25 within the disputed territory. [7] As Somalia reports in its application:

Kenya awarded Block L-5 to the American company Anadarko Petroleum Corp. in 2010 (though subsequent reports appear to indicate that Anadarko gave up its interest in late 2012 or early 2013). Blocks L-21, L-23 and L-24which lie entirely (in the case of L-21 and L-23) or predominantly (in the case of L-24) on the Somalia side of a provisional equidistance linewere awarded to the Italian company Eni S.p.A. in 2012. Block L-22 was awarded to the French company Total S.A. the same year. [8]

Press reports confirm that, in 2012, Total S.A. entered into a production sharing contract with the Kenyan government to operate L-22 with a 100 percent interest and holds a 40 percent interest in the Anadarko-operated L-5. [9] Somalia itself recently invited energy companies to contract to explore the disputed area. [10] And, if the ICJ adopts Somalias position, Tanzanias control over Blocks 10, 11, and 12licensed to Shell and Dominion Energywill come into question. [11]

The ICJs ultimate resolution of the case will undoubtedly influence the future of East Africas offshore development. Companies contracting with Kenya and Tanzania for offshore developmentand companies considering such contracts with Somaliashould continue to monitor the ICJs handling of the dispute. 

[1]
Maritime Delimitation in the Indian Ocean (Somalia v. Kenya), Application Instituting Proceedings (herein after Application) 2 (I.C.J. Oct. 24,2014).

[2] Application 19.

[3] Application 18. Somalia also claims relief under customary international law, as well as the general international law of maritime delimitation as applied by the ICJ and other international tribunals. Id.

[4]
Maritime Delimitation in the Indian Ocean (Somalia v. Kenya), Order of 9 October 2015 (I.C.J. Oct. 9, 2015).

[5] Aggrey Mutambo, Kenya Objects to Coastal Boundary Case Filed By Somalia At the ICJ, Daily Nation, Oct. 7, 2015.

[6]
Maritime Delimitation in the Indian Ocean (Somalia v. Kenya), Order of 9 October 2015 (I.C.J. Oct. 9, 2015).

[7]
Somalia Takes Kenya to U.N. Court in Oil Rights Row, Reuters, Aug. 29, 2014, http://www.reuters.com/article/us-world-court-somalia-kenya-idUSKBN0GT0FW20140829 (last visited on Feb. 26, 2006).

[8] Application 26.

[9] Alan Petzet, Kenya: Total Awarded Lamu Deepwater License, Oil & Gas J., June 27, 2012, http://www.ogj.com/articles/2012/06/kenya-total-awarded-lamu-deepwater-license.html (last visited on Feb. 26, 2006).

[10]
Somalia Invites Energy Companies to Explore for Oil, BBC, Dec. 8, 2014, http://www.bbc.com/news/business-29993447 (last visited on Feb. 26, 2006).

[11]
Opinion: Kenya Somalia Maritime Border Dispute Could Throw Whole Region Into Dispute, Oil News Kenya, Sept. 30, 2014, http://www.oilnewskenya.com/opinion-kenya-somalia-maritime-border-dispute-could-throw-whole-region-into-dispute/ (last visited on Feb. 26, 2006).

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