The Upper House of the Somalian Parliament has approved a new petroleum law which it expects to attract investments from big oil companies.

The Lower House of the parliament approved the law last year.

This is a revised version of a 2008 regulation. It seeks to provide a regulatory framework for the petroleum industry and to help bring investment into the country.

Somalia currently has no involvement in oil production. However, Reuters reports that there could be ‘significant oil reserves offshore,’ as shown by seismic data. This would create job opportunities in the conflict-torn country.

The federal and regional governments will be able to share revenues once the law takes effect.

Somalia Petroleum and Mineral Resources Minister Abdirashid Mohamed Ahmed was quoted by the news agency as saying: “This is a major step forward for Somalia and its people as the petroleum law is approved by the upper house and moves closer to completing its legislative process.”

The new legislation will be effective once signed by the president.

Minister Ahmed told Reuters in November about Somalia’s plans to award first oil and gas licensing near the country’s coastline by the end of the year.

ExxonMobil and Shell hold offshore blocks in the country, although operations halted long back. The two major oil companies paid $1.7m to Somalia for leasing the blocks last October.