Issue No. 303

The Unfinished War Over Oil in the SRS
 

The Ogaden National Liberation Front's (ONLF) attack on the Chinese-operated oil exploration site in Abole in April 2007 was arguably the single most consequential event of the decades-long insurgency. Coming shortly in the wake of the Ethiopian invasion of Somalia, 65 Ethiopian workers and 9 Chinese engineers were slain in the dawn raid, with the ONLF justifying the attack by arguing that "foreign companies who exploit the wealth of the Ogaden while our people are killed, starved, and displaced are legitimate targets." Nearly two decades later, the reverberations of the attack —and the subsequent government crackdown —are still keenly felt in the peripheral Somali Regional State (SRS). With the announcement of another Chinese company's involvement in the building of a new hydrocarbon refinery last week in the SRS, and the now-disarmed ONLF's furious response, the ugly history of resource extraction in the eastern region is rearing its head once again.

The aftermath of the Abole massacre in 2007 was immediate and brutal, with the Ethiopian People's Revolutionary Democratic Front (EPRDF) government launching scorched-earth counterinsurgency operations in the restive SRS. Entire districts, including Fiiq, Wardher, Korahe, and more, were sealed off, and many of the rural areas where the ONLF drew its support were rendered uninhabitable. Despite such repression, the Asmara-backed ONLF nevertheless sustained a guerrilla campaign for several years, continuing to advocate for the rights and self-determination of the Somali-speaking people of the SRS. Meanwhile, the Liyu paramilitary troops and the Ethiopian National Defence Forces (ENDF) were accused of a series of atrocities, with a 2008 Human Rights Watch report detailing the "collective punishment" meted out in the SRS. Such tactics followed a familiar pattern that pre-dated the EPRDF, with the Derg adopting a similarly militarised posture towards the SRS in the 1970s and 1980s, which was regarded as somewhat betwixt and between due to its ethnic and political linkages with neighbouring Somalia, particularly in the aftermath of the calamitous 1977-78 Ogaden War. 

Across these intervening years, oil in the SRS has remained a particularly potent symbol of the sustained underdevelopment of the Somali-speaking region. The discovery of oil in the Ogaden Basin dates back to the 1920s, when the US firm Standard Oil carried out some early exploration work. It was not until the 1970s, however, that significant quantities of gas were discovered in the Calub and Hilala fields in the Basin, signalling substantial hydrocarbon deposits. And while the Derg regime was floundering amidst war with Tigrayan and Eritrean rebels, it nevertheless began granting oil and gas exploration rights in the late 1980s onwards, including to Tenneco and Petronas. But for the ONLF and other opposition movements, the natural resources of the Ogaden have always belonged to its citizens, rather than Addis or some foreign company, and they have repeatedly argued that the revenues have been used to repress Ethiopian Somalis rather than to develop the SRS.

On 2 October, PM Abiy Ahmed laid the foundations for another substantial energy project, the Gode Oil Refinery, with a capacity of refining 3.5 million tonnes of fuel from the Hilala fields per year, in partnership with the Chinese firm Golden Concord Ltd. This marks the third substantial energy project announced or inaugurated in just a handful of weeks, following the unveiling of the Grand Ethiopian Renaissance Dam (GERD) in September and the recent announcement of a nuclear power plant with Russian backing. However, unlike the gold of Tigray, where small-scale, militarised mining has proliferated in the aftermath of the war, oil remains a heavily centralised resource, with the complexity of refining and exporting often meaning that few benefits are directly funnelled back towards the areas from which it was drawn. This centralised political economy of oil is perhaps best seen in South Sudan, where the elite are addicted to the petrodollars from the national oilfields, while the overwhelming majority of the population remains highly impoverished.

As part of the SRS's hydrocarbon development, the prime minister also inaugurated the first phase of the Ogaden Liquid Natural Gas project in Calub, with a capacity of 111 million litres of extraction per year, with the second phase projected to increase this by 1.33 billion litres per year. Upon completion, this will provide an additional 1,000 megawatts of power and serve as feedstock for fertiliser, at least according to Addis. Much like the nuclear power plant deal, though, while the cost of the refinery has been estimated at around USD 2.5 billion, the commissioning date has yet to be announced. Spokesperson Billene Seyoum has asserted that the first phases will be completed within two years, but given enduring security and logistical concerns, this may be ambitious. 

Still, the prime minister has pledged-- as others have before him-- that these projects will be transformative for the SRS, supposedly dragging the impoverished region out of its mire. But nearly two decades after the ONLF's attack, and although the former insurgents may have laid down their arms, the SRS remains the most underdeveloped region in the country. And while the feared Liyu forces—the favoured weapon of the former Abdi Iley administration—may have been partially disbanded, it would be naive to dismiss the rumblings of discontent within the SRS. Initial hopes that SRS President Mustafa Omer 'Agjar' might herald a new era have long since dissipated, with his administration marred by successive corruption scandals as well as intermittent clashes along the Oromia and Afar boundaries. The latest controversy to engulf Agjar's administration in Jigjiga was the unilateral redrawing of contested boundaries and administrations in mid-2025, a move widely regarded as an attempt to consolidate power and exacerbate inter-ethnic tensions with the Oromo. And since the 2018 peace deal in Asmara, Agjar's government has repeatedly sought to neuter and undermine the ONLF through a host of underhanded tactics, including establishing splinter leadership cells. In turn, the ONLF —now a registered political party —has increasingly warned of a return to the battlefield this year, citing the failure of Addis and Jigjiga to abide by the peace agreement.

With relations already badly deteriorated between the ONLF and Addis, the party's press release yesterday outlined a detailed series of criticisms against Addis and the abuse of the SRS, asserting that the "Ogaden Gas Project" marks a new "chapter of colonial exploitation." With a graphic of a bloodstain on the first page, the ONLF warns that the project is cloaked in the language of "investment" and "modernisation" but is part of a campaign of "exclusion, dispossession and environmental destruction." It further lists issues such as the displacement of villages by the ENDF and toxic waste spills amid the broader sidelining of the people of the SRS. Only briefly referencing the Abole raid, the statement ends ominously, stating that "the Somali nation will never accept development built upon its suffering and silence."

It is improbable that the disarmed ONLF would somehow attempt a repeat of Abole, but it is unmistakable that, despite changes in leadership in Addis and Jigjiga, the same issues surrounding the extraction of oil to the detriment of the people of the SRS remain. From administration to administration, the underdevelopment of the SRS and its political sidelining has persisted, with Iley and now Agjar permitted to rule the region as their personal fiefdoms. The grand pronouncements last week appear to be more of the same, with the unpopular Agjar clinging to his position and the SRS's political settlement inching towards total collapse. Furthermore, it seems increasingly improbable that the rent-seeking administration in Jigjiga, or the forex-starved Addis, will be willing to cede any future profits from the latest extractive project —if it is even built. Years on from Aboye, in the eyes of the ONLF, oil and gas remain the symbol of the SRS's subjugation-- not its salvation.