The lease of Block LB-16, off the shores of Grand Cape Mount and Bomi Counties, has been ratified by members of the House of Representatives and immediately transmitted to the Liberian Senate for concurrence in accordance with Article 35 of the Liberian Constitution.
The Production Sharing Contract (PSC) for the oil exploration of Offshore Block LB-16 is valued at US$22 million.
The lawmakers unanimously passed the leasing of the oil block upon the advisement of the Committees on Investment and Concessions, Contracts and Monopolies and Judiciary.
The Representatives reached the decision yesterday, December 18 during its 30th day Special Sitting of the Extraordinary Session following a Communication from President Ellen Johnson Sirleaf requesting that they remain in session.
The Production Sharing Contract is signed by the Government of Liberia, Liberty Petroleum Corporation Liberia II, Pillar Oil Limited and New Millennium Oil and Gas.
The Liberty Petroleum Corporation is an international oil company based in the United States of America; Pillar Oil Limited is an oil exploration and production company from the Federal Republic of Nigeria and New Millennium Corporation is owned by Liberian citizens.
It may be recalled that the Chief Executive informed the Lawmakers that the country would receive a signature bonus of US$10,500,000 with additional funds payable for the acquisition of seismic data for LB-16 at US$11,500,000.
In her communication, the President maintained that the ratification of the agreement would facilitate the generation of needed revenue for the State and for the National Oil Company and also set a precedent for Liberian citizens to participate actively in the oil sector.
The passage of LB-16 is one of the four undrilled offshore petroleum exploration Blocks— LB-6, LB-7, LB-16 and LB-17—submitted by President Sirleaf, which caused the one-week extension of the Legislature’s session before proceeding for their constituency break which they should have taken in September. The first leg of the delay was due to the Ebola virus.
It may be recalled that eight of Liberia’s off-shore blocks have already been leased. They include: Block 8, located off the coast of Sinoe County, and Block 9, off the coast of Sinoe and Rivercess counties. These have been leased to European Hydrocarbons Limited.
Block 10 off the coast of Rivercess County, was contracted to Anadarko of the USA (80%), Mitsubishi of Japan (10%) and Repsol of Spain (10%); while Blocks 11 and 12, off the coast of Grand Bassa County, were leased to Chevron (45%), Oranto (30%) and ENI (25%).
Block 13, off the coasts of Montserrado and Margibi Counties, were contracted to ExxonMobil (80%) and COPL (20%), while Block 14, located in the same areas, were leased to Chevron (45%), Oranto (30%) and ENI (25%).
The last of these, Block 15, off the coast of Montserrado and Bomi counties, were leased to Anadarko (47.5%), Repsol (27.5%) and Tullow (25%).
Most of the oil blocks are still undergoing explorations.
Meanwhile, the National Legislature also finally ratified the Petroleum (Exploration and Production) and the National Oil Company of Liberia (NOCAL) Acts of 2013.
The Legislature, in separate sessions, passed the two Oil Laws after an advisement from the Conference Committee comprising members of the Liberian Senate and the House of Representatives.
The passing of the Oil Laws followed a validation from at least 150 stakeholders from over 30 Civil Society Organizations (CSOs).
The representatives of the CSOs recommended limitations to the power of the Head of State in order to promote sustained transparency, accountability and good governance.
The validation was the final revision of the House of Representatives to confirm their commitment to bring reform including transparency and accountability to the Oil and Gas Sector and to ensure that all Liberians duly benefit from the potential hydrocarbon deposits.
The conference took place recently at the Monrovia City Hall.
Prior to the validation there was a round-table discussion and a nationwide tour to obtain the views of Liberians from across the country.
The Petroleum (Exploration and Production) Act, dubbed the E & P, centered on the establishment of a fiscal and legal regulatory framework for the management and regulation of petroleum activities in the country; while the NOCAL Bill is to be established as a commercial entity for the purposes of managing, on behalf of the state, to undertake the exploration, development and production and disposal of petroleum.
The NOCAL Act is also to manage the citizens’ participation in the rights and interests in all petroleum agreements.