aoc in trouble?

Canada's Africa Oil stops Somali exploration:staff
Sun 4 Jan 2009, 11:31 GMT

[-] Text [+] By Abdiqani Hassan

DHAROOR, Somalia (Reuters) - Canadian oil and gas exploration company Africa Oil Corp has stopped exploration in Somalia's Puntland region for lack of funds, local staff and contractors said on Sunday.

The company had started seismic mapping in a region it believed had strong prospects of holding rich oil deposits like those in geologically similar Yemen, a neighbour across the Gulf of Aden.

"Africa Oil Corp has failed in its objective ... due to lack of funds," Ahmed Ali, a local staff member, told Reuters. "We have not received salaries for three months. Foreign staff have already flown out and the company has stopped its operation."

Company management could not be reached for comment.

Africa Oil has rights to 80 percent of the Nugaal and Dharoor blocks and its joint venture partner, Australian independent Range Resources,, holds the remainder.

Puntland's semi-autonomous government entered into a production-sharing agreement with the two companies in January 2007.

A local policeman who worked for Africa Oil's security unit said he and local colleagues had impounded the company's equipment until their dues were paid.

"They wanted to take their mapping equipment but we shall not give (it to) them unless they pay all the money," Mohamud Ahmed, a police officer in charge of security, told Reuters.

Somalia has no proven oil reserves but a joint World Bank and U.N. survey of northeast Africa 16 years ago ranked it second only to Sudan as the top prospective producer in the area.