ESG

Statement by Africa Oil

In response to on-going media allegations about our operations in Ethiopia and Somalia, we believe it is important that we provide further facts about the situation on the ground to a wider audience. Our statement in regards to our Ethiopian operations is already on the front page of our website and remains relevant, addressing all of these allegations. In relation to our activity in Somalia we would like to make the following comments.

Somalia is going through an unprecedented period in its history with a real opportunity for all stakeholders to assist in the rebuilding of the country. We believe that any discovery of oil, and the associated revenues that could potentially be derived from this, could significantly aid the rebuilding of the country in the long-term if managed in a sustainable and responsible manner. Whilst the political and security situation in Somalia remains complex and challenging it is only through the active engagement of all stakeholders (governments, international organisations, the private sector, civil society and local communities) that these can be addressed and resolved.

Africa Oil Corp., through its subsidiary Horn Petroleum, has been active in Somalia since 2007. The Puntland Regional government was at that time the recognised authority with whom we negotiated the contracts. There was no permanent Federal government in Mogadishu and Somaliand had unilaterally claimed independence in 1991, but had not been recognised by the international community. The borders claimed by Somaliland were also not recognised internationally and so both of our concessions were located within the Puntland region of Somalia. Claims by other companies that are under Force Majeure are primarily a matter between them and the Puntland Regional State. However we understand that the government has approached all of these contract holders to determine their position and none of them have indicated an intention to resume activity.

Africa Oil is actively engaged in discussions with the relevant national and regional governments in Somalia, international governments and organisations, as well as other industry players on how best to take forward the exploration of these resources across the country in a way that reduces rather than exacerbates tensions on the ground. This includes discussions around how Somalia can develop the institutions and systems it needs to best manage these resources in terms of an effective Federal system, good governance and financial transparency.

Whilst there is on-going conflict across many parts of Somalia this is not related to our company's presence. We have also stated that we will not move forward our operations in the Nugaal Valley until border issues have been resolved, in order not to exacerbate the situation.

Keith Hill
President/CEO Africa Oil Corp.