18 December 2014, Monrovia – Liberia’s President Ellen Johnson-Sirleaf has submitted for ratification, a Production Sharing Contract (PSC) for the first Oil Block, LB-16 to the House of Representatives.
Contractors for the PSC include Liberty Production Corporation, an International oil company based in the United States of America, Pillar Oil Limited, an oil exploration and production company from the Federal Republic of Nigeria and New Millennium Corporation, an entity owned by some private Liberian citizens.
In a communication Tuesday to plenary, President Sirleaf said the National Oil Company of Liberia (NOCAL) and the Hydrocarbon Technical Committee have assented to the recommendation and in keeping with law the PSC has been dully signed. President Sirleaf said the award was recommended by Ernst &Young (EY) based on its evaluation.
The Liberian leader said based on criteria set, this was the highest bid with a signature bonus of US$10,500,000 and within the addition of funds payable for the acquisition of seismic data for LB-16 at US$11,500,000.
According to her, it makes the total amount to be received from the lease transaction for LB-16 to US$22,000,000.
This, she said, places Liberia once again in the rank of active frontier countries for oil exploration.
“In light of new information, the evaluation of process continues to conclude on the most suitable party with whom the state through NOCAL may contract for other blocks put out for bid in this Liberia basin 2014 Bid Round. With the advent of Liberia-citizen ownership participation in LB-16, it is expected that other Liberian-owned businesses will get the other opportunities to participate with international oil companies to obtain interest in other oil blocks,” President Sirleaf indicated.
President Sirleaf: “In respect of the process of concluding on other blocks, which were put out for bid, additional information available has necessitated further assessment now being undertaken by EY and which was not part of EY’s scope of work. We are working expeditiously to conclude that task, as its outcome will guide our next steps. We look forward to keeping you apprise development in that regard.”
The President noted that the bid round had two key objectives which include seeking to maximize signature bonuses that would assist in addressing the nation’s present financial challenges and through exploration for hydrocarbons, increase Liberia’s prospects for commercial oil discovery and development by opening some vacant and vacated acreage for development in the Liberian basin.
