The joint energy committees of the House of Representatives and the Senate yesterday made summary briefing to their respective plenary, informing them that the National Oil Company of Liberia (NOCAL) is currently facing a serious financial crisis that requires urgent austerity measures.
In view of the debacle, the Legislature has cited Ministers of Lands, Mines and Energy, Finance and Development Planning and Justice to appear at the joint Legislature Committee to answer inquiries relating to NOCAL activities.
A brief from the Legislative hearing signed by the Chairman of the Senate Committee on Lands, Mines, Energy, Natural Resources and Environment Albert Tugbe Chie (as lead committee) is said to be progress information on that hearing which took place on June 8, 2015 in the Joint Chambers of the Legislature with the participation of the Standing Committee on Energy of the House of Representatives.
The main terms of reference of the joint committee are to ascertain the financial health of NOCAL, the status of the oil exploration program, the reform process and the 2014 petroleum bid round.
After more than four hours of questioning and deliberations, the NOCAL team, according to the report, “confirmed that NOCAL is facing a serious financial crisis requiring urgent austerity measures, and that most of the previously encumbered oil blocks are now virtually vacant and the 2014 bid round remains inconclusive.
Due to the gravity of the circumstances faced by the oil program the report said the joint legislative committee has planned further hearings next week to be able to probe deeper into the matter inorder to make a full report to plenary.
During next week’s hearings, the Chairman of NOCAL’s board of directors will be reappearing along with the company’s senior management team, to provide a short to medium term plan for keeping the oil exploration program active and prevent it from total collapse, the joint committee informed plenary.
Furthermore the NOCAL team will be asked to provide the company’s proposed plan and details on the austerity measures contemplated in the immediate short-term to keep NOCAL financially intact.
“If the retrenchment or redundancy of employees is being considered as part of these measures, the company is to put this on hold pending further consultations between NOCAL and the Joint Senate and House Committees,” advised the joint committee.
The Ministers of Lands, Mines & Energy, Finance and Development Planning and Justice are expected to attend the next hearing. The three Ministers oversee the energy, finance and legal sectors respectively, and are all members of the hydrocarbon technical committee while the first two ministers are members of the board of directors of NOCAL.
“From information available to the joint committee, it is alleged that the three ministers participated in policy decisions and approvals which have contributed to the present predicament engulfing NOCAL and the oil program, and their views on moving the oil program forward will be very useful,” the joint committee stated.
It has been widely publicized that NOCAL is in such bad shape that it cannot pay the mortgage for the three floors it occupies in the building owned by the Episcopal Church on Randall and Ashmun Streets.
Sources say that the disaster is so extreme that NOCAL is contemplating retrenching dozens of employees, especially those within the lower bracket earnings, while retaining members of the senior staff including the company’s nine vice presidents.