Gov’t Intensifies Campaign for Local Participation in Oil/Gas Sector

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LPRA Director-General, Hon. Archie Donmo (far right), meets leaders of local business organizations in Monrovia

-As LPRA meets with indigenous businesses; extends pre-qualification timeframe

As a means of ensuring that Liberian owned companies fully participate in the country’s ongoing offshore petroleum licensing round, the Liberia Petroleum Regulatory Authority (LPRA) on Friday, June 5, 2020, held a meeting with representatives of the Liberia Business Association (LIBA), Liberia Chambers of Commerce (LCC) and the Patriotic Entrepreneurs of Liberia (PATEL) to fully explain the processes and relevance of Liberian companies participating in the licensing round.

During the meeting, the LPRA Director-General, Hon. Archie Donmo, stressed the significance of Liberian companies participating in the petroleum sector and pointed out, “I encourage everyone to take advantage of this tremendous opportunity which is potentially one of the means of promoting private sector growth in this country.”

Participating institutions of the meeting lauded the LPRA for the initiative and expressed interest in working with the Authority in ensuring that Liberian companies are fully involved in the petroleum sector, particularly during the 2020 offshore licensing round.

According to the LPRA, the calls for more Liberian companies involvement in the 2020 offshore licensing round is hinged on President George Weah’s promise, through his inaugural address in January 2018, that under his watch, “Liberians will not be spectators in their own economy.”

The desire to incorporating more Liberians or indigenous businesses is further based on the indigenization mandate by the Liberian government as required in section 36(a) of the Amended Petroleum Law of Liberia, which sets aside a mandatory 5% interest in all petroleum agreements to companies owned by natural persons of Liberian citizenship.

To facilitate the enforcement of this provision, LPRA is conducting pre-qualification of Liberian companies and has issued a request for expression of interest.

LPRA held consultations with cross-sections of Liberians earlier this year to deliberate on the oil and gas sector, soliciting ways of improving the sector

The pre-qualification process, which started March 17, 2020, was scheduled to end June 30, 2020. However, due to an appeal from the Liberian business community, especially the Liberia Chamber of Commerce (LCC), Liberian Business Association (LIBA) and Patriotic Entrepreneurs of Liberia (PATEL) and, in consideration of the state of emergency as a result of the Coronavirus pandemic, the Authority has extended the deadline for expression of interest to Friday, July 31, 2020.

LPRA also believes the total involvement of Liberians in the sector will also help to spur growth and enhance financial capacities of locals — which in turn will help to alleviate poverty. The oil and gas sector, with the help of the government through the LPRA, would be a pacesetter for a Liberian middle class,” a top Liberian economist told the Daily Observer via social media. “They are doing a great job with the engagement with the local businesses and they (LPRA officials), should be encouraged to do more as Liberians have suffered too long and there is a need they have shares of their natural resources,” he said.

Meanwhile, a Q&A zoom meeting is scheduled to be held on Friday, June 12 at which time Liberian companies interested in participating in the ongoing licensing round will be given the opportunity to ask the necessary questions relating to the bid round. LPRA encourages Liberian companies to take advantage of this opportunity and position themselves as partners in the quest for hydrocarbon resources.

Nine offshore blocks in the Harper Basin are being tendered during the licensing round. This region represents Liberia’s most prospective geological regions and the only unexplored and undrilled region in the West Africa Transformed Margin. The 2020 Liberia Offshore Licensing Round runs from April 10, 2020-February 28, 2021.

3 COMMENTS

  1. Look before you leap . Look before you leap. The so-called oil laws as it is written need to either be written again or give more details explanations to would be Liberian investors. As the law is written, it was mostly written for foreign investors or large companies, with participating Liberian investors rewarding only 5 percent of the total deal. So who owns the other 95 percent ? If the government owned the second largest percent in deal and the one with largest percent as owner is not available, and the government which has the second largest percent is broke to even start in the investment, why run to those with only 5 percent interest to start the investment ? In the absence of the other two with the largest interest or percent. If those with only 5 percent must start the investment, in the absence of the government and potential foreign investors, then it is fair to increase the percentage interest of participating Liberians. As it stands, the burden to start the so-called oil investment in the is on their shoulders. If the government was starting the investment, then the participating companies would buy their 5 percent stake or interest. But no one is starting the investment, yet those with 5 percent must be the first to put down their hard earned money ? What happened to their money if the government failed to start the investment in the absence of a foreign company or investors ? Simply put , why invest in a government that is broke to even start the investment in the so-called oil industry? Why go to those struggling Liberians owned companies, when there are already potential political investors in the country already ? They love the country so much to make their money and living from it , but refused to invest the same money back into the country. Carry the oil investment to Ellen Johnson Sirleaf, carry it to the Speaker and former Speaker, carry it the Pro-temp. At best carry it to Senator Varney Sherman. There are many other potential Liberians in that country with money to start in the bidding process. Perhaps, when others see them putting in their stolen wealth in the oil bidding process, those other Liberians with 5 percent interest will joined in. Right now the government is broke to even start or get involved , and the potential foreign investors are not coming to bid on anything, and the potential political millionaires in the country are not taking on any risk to bid, the wise thing to do for those Liberians companies with their 5 percent interest in any potential investment , look before you leap. Ask the organizers why potential Liberians millionaires are not interested. 419 ? Since there are no foreign investors right now , government please startup the investment in the oil industry . But we are too broke to start. This smells let the usual government savings bonds invest scheme that many citizens invested in and never got their money back. 419, look before you leap again.

  2. Mr. Donmo,

    The petroleum sector in Liberia is mined.
    First, demine the sector and rework the legislation for a level plain field competition, then create incentives for Liberian businesses. We want to partake in our economy. We want to build our country.
    Stop behaving like you support Liberalization. Only CDCians will believe what you are saying because they do not read. We do, Sir.

    So, you want me to take my hard-earned cash and pump it into thin air? Stop lying to the general public man!

    No more war in Liberia!

  3. The price of petrol has diminished on the world markets at a time when the government of Liberia is hard pressed for foreign currency to boost her economy. Is it market forces militating against the government’s efforts, or is it because a profusion of oil on the world markets has made industrial giants that were once dependent on other countries for their supplies, to become efficient as the result? These plus a mixed of several factors may be playing into the dynamics.

    However, given the current administration’s inability to manage both the financial and natural resources to ensure the equitable distribution of the nation’s wealth, I think Liberia is well of being the way it is now than to venture deeper into oil mining.

    The converging opinion of many experts on oil exploration in Africa is oil becomes a resource curse once it is discovered. In other words, instead of it being a catalyst in helping the African countries to combat endemic poverty, to create jobs, to educate and train the workforce, to build thriving health and educational institutions, it in fact promotes more poverty, misery, political and tribal divisions; worst, situations such as these often set the pace for the waging of some very devastating, internecine tribal warfare such as the one that was fought for 14 long years in Liberia.

    Three years into the current administration have been enough to hint to Liberians in comparison to many of our sister countries in the region, Liberia has demonstrated that she is incapable of self-government and her current leadership stock is enamored with unbridled greed.

    If anyone should imagine that oil exploration will bring wealth and prosperity to all Liberians, then let he or she stop and think about what is already happening now to the scanty resources of the nation.

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