Monrovia – President Joseph N. Boakai’s current determination to award 100% possession of 4 offshore oil blocks to the Nationwide Oil Firm of Liberia (NOCAL) with out first looking for enter from the Legislature or key stakeholders is drawing sharp criticism from business consultants and economists, who warn that the transfer may undermine transparency and investor confidence in Liberia’s fledgling petroleum sector.
By Obediah Johnson, [email protected]
Whereas justifying his determination, President Boakai argued that granting the oil blocks on to NOCAL would streamline the method for potential traders.
“Firms we’ve talked to need to come, however are hesitating due to the legislative course of they need to undergo independently,” Boakai said. “However as soon as NOCAL will get the block, which the Legislature will rectify, these firms will solely have to transact with NOCAL, saving them the lengthy and complex legislative course of.”
NOCAL has welcomed the president’s determination. In an announcement, the oil firm stated the allocation of blocks LB-10, LB-11, LB-29, and LB-31 represents a transformative step in Liberia’s vitality sector improvement.
NOCAL provides that the total possession switch ensures most monetary returns for Liberia, with all future revenues from these blocks immediately benefiting the Liberian individuals by means of nationwide improvement initiatives, infrastructure enhancements, and social applications.
It claims that by sustaining full management over these sources, Liberia safeguards its long-term vitality safety and reduces dependence on overseas vitality imports.
“The allocation creates substantial financial alternatives, together with the potential for 1000’s of direct and oblique jobs in exploration, manufacturing, and associated sectors. It additionally positions NOCAL as a significant participant in Africa’s vitality panorama, attracting technical experience and worldwide partnerships that can construct native capability within the oil and fuel business.”
President Boakai additionally directed the Liberia Petroleum Regulatory Authority (LPRA) to instantly start negotiation of the Petroleum Sharing Contracts (PSCs) beneath strict adherence to the mannequin petroleum sharing settlement.
NOCAL emphasizes that the mandated ten-working-day completion timeline demonstrates the administration’s dedication to environment friendly useful resource improvement whereas sustaining rigorous requirements of transparency and accountability.
“This determination additionally reinforces Liberia’s sovereignty over its pure sources whereas creating a beautiful funding framework. The NOCAL allocation enhances the LPRA’s regulatory oversight, establishing a balanced strategy to sector development that prioritizes each nationwide pursuits and worldwide greatest practices.”
Jaleiba says there are at present ongoing negotiations with Complete energies and Exxon, and that beneath the brand new legislation, NOCAL has to submit a plan to LPRA earlier than going for laws. Jaleiba’s feedback contradict NOCAL’s launch which stated it has already been accredited.
Nevertheless, a Liberian oil sector professional, talking on situation of anonymity, described the president’s strategy and NOCAL’s public announcement of the award as “untimely and disruptive.”
“NOCAL’s press launch is deliberately untimely and disruptive,” the professional stated. “Each the president’s determination and NOCAL’s untimely assertion have far-reaching unfavorable penalties for the sector. The President ought to seek the advice of the Legislature as required and never come throughout as dismissive.”
The professional, who most popular to not be named, identified that President Boakai ought to have consulted the Legislature earlier than awarding oil blocks to NOCAL, including that the transfer made by the Liberian chief is “unilateral and pointless.”
The professional additionally known as on NOCAL to publicly establish the businesses it intends to associate with and challenged the Liberia Petroleum Regulatory Authority (LPRA) to show that it has the technical capability to assist oil exploration and manufacturing throughout the subsequent 4 years.
“NOCAL ought to submit an inventory of firms to LPRA for pre-qualification. It is because NOCAL doesn’t have the monetary and technical capability to drill or function an oil block and can flip the block to a different firm,” the professional said.
The professional maintained that pre-qualification by the LPRA could possibly be a safeguard to make sure the blocks get to firms with the monetary and technical capabilities to drill.
In accordance with the professional, Liberia’s present precedence is to search out firms which have the capability to drill, not “intermediary” firms that will maintain the blocks for years whereas on the lookout for offers to flip.
The professional added: “The President ought to seek the advice of the Legislature as required and never come throughout as dismissive. NOCAL ought to tell us the businesses she intends to work with, and LPRA should show that they’ve the technical capability to assist us drill within the subsequent 4 years.”
An economist, additionally talking anonymously, likened the transfer to previous controversies within the Boakai administration, particularly referencing the so-called “Yellow Machine” saga.
“This determination is counterproductive. It has unfavorable penalties,” the economist stated. “By now, the president and his interior cupboard ought to have realized their lesson. This is similar factor they did with the Yellow Machine saga, the place just a few officers used their affect to enter into agreements with overseas firms for the procurement of 285 earthmoving gear at exorbitant charges. That was reckless and an act of corruption. Had it not been for the media and the Home beneath the gavel of former Speaker Fonati Koffa, hundreds of thousands of {dollars} would have been misplaced.”
He added that choices of this magnitude should embody legislative enter and oversight to keep away from governance failures and promote accountability.
The Govt Mansion is but to reply. The Senate Hydrocarbon Committee, headed by Senator Edwin Melvin Snowe, is anticipated to carry a listening to for the affirmation of the newly appointed Board Chair of NOCAL Counselor Gloria Musu Scott.
Points surrounding the unilateral determination made by President Boakai to award 4 oil blocks to NOCAL with out the enter of key stakeholders might possible floor through the listening to.
As issues develop over transparency and the rule of legislation in Liberia’s oil sector, it stays to be seen whether or not President Boakai will revisit his determination or interact the Legislature and stakeholders to make sure a extra inclusive and clear course of transferring ahead.
