1.The value in range shares will appreciate considerably (maybe 100x?) if oil or minerals are actually extracted and sold. The ppl of somalia, who have been given no consideration in the decades of brutal murders and power struggles that have seen the natural resources having no value to the starving women and children who live there, therefore have a safeguard built into the deal.
2. The resources of puntland are not worth the current high prices as they sit in a strife torn land. They are worth the usual futures discount, less exploration and extraction costs, with a risk premium that all the work could come to nothing if the warlords wipe out the provisional government yet again. Puntland's problem is not that the deal is bad, but that they have not been able to attract anyone to give them the value of their resources.
In any case, royalties to the sovereign nation are rarely above 10% of revenue. I doubt we get that for our vast tonnes of coal leaving NSW at present, but I am not complaining.
Your article, punty, reeks of sour grapes from would-be leaders, concerned for themselves, not the ppl of somalia.
RRS Price at posting:
0.0¢ Sentiment: LT Sell Disclosure: Held
