The Canadian Africa Oil Corporation holds 45 % equity interest in Horn Petroleum Corporation, which is holding interests in two blocks in the semi-autonomous region of Puntland. The blocks are the Dharoor Valley and the Nugaal Valley exploration area and combine to an area of 3,616,800 hectares within Puntland, Somalia.

By May 2008, Africa Oil had started seismic mapping of Puntland in advance of exploratory drilling. In 2007, the government of Puntland had entered into a production-sharing agreement with Africa Oil and Australian independent Range Resources. Between 2005 and 2007, political disputes had already taken place between the interim Somali government and Puntland, when the regional government had refused to honour a 2005 deal reached with Range Resources. The political tensions led to the resignation of former Prime Minister Ali Mohamed Gedi. Later during May 2008, when Africa Oil Corp. exploration equipment undocked at the port of Bossaso, militia already launched their first strike. Unidentified militiamen reportedly attacked the location and an exchange of gunfire took place.

In January 2012, Africa Oil began drilling in Puntland, when opposition against the operations started to stir up again. Many Puntland officials had expressed their objections to the drilling, as they said that it would ignite clan warfare. The Somali Golaha Samatabixinta Puntland (GSP), or Puntland Rescue Committee, formed as a political movement in 2012 to oppose Puntland President Farole and his decisions concerning the drilling. The GPS opposed the drilling saying that disputes should be resolved and security enhanced first, in order to mediate clan fighting in Puntland.

Another group opposing the drilling in Puntland was formed by local elders. They also believed that the project and its support by western oil companies would result in clan conflicts and have a negative environmental impact. They stated that the oil drilling had already had a negative impact on local livestock, such as their camels. Also, they suggested that other elders had been bribed to refrain from expressing their opinion on the drilling. One of the traditional elders and resident of Dharoor valley, Chief Abdirizak Hussein Saciid, was stating that he mainly opposed the project because of the lack of prior consultation. Also, he said that his people had not been told in what way the drilling would benefit them in the future. Many of other local elders and chiefs agreed with this position and also cited water rights as source of conflict.

In the country, many people in the region believed that oil drilling would bring back conflict between clans that had occurred in 2006, when the government had once before tried to explore oil in Majiyahan without prior consultation of the locals. The ensuing fight, taking place 35 km south of the city of Bosaso, had led to the death of 30 people and let to the creation of a local militia operating in the Galgala mountains. In March 2012, islamist rebels attacked soldiers from the semi-autonomous Puntland region, killing at least 9 people. It is unclear whether this attack can be related to the drilling activities.

These events led, in 2014, to the United Nations to state that oil exploration could fuel violence in the autonomous regions of Puntland and Somaliland , until now relatively spared of the violent armed conflict ravaging the rest of Somalia. Thus, after violence and clan fights had once more erupted and continued, Africa Oil Corp. announced on 12 February 2015 that it had informed the Government of Puntland that the company will be downsizing its office in Bosaso, Puntland and that it will “refrain from any operational activity and associated expenditures until the political situation improves”. The company also requested a two year extension to the current exploration period from the local government in order to continue exploration once the “ongoing political challenges” will be “resolved”.

Nevertheless, in september 2015, the US based corporation, ION Geophysical, was awarded "a contract to acquire 8,000 kilometers of seismic data covering the entire Somalia Puntland offshore margin".

Within the Dharoor Valley and Nugaal Valley exploration areas, three wells were drilled. Daily production rates are of over 400,000 barrels of oil. Africa Oil Corp. estimated local resources at nearly 300 million barrels.