NOCAL holds packed investor roadshow in London
(MONROVIA AUG 19) On Tuesday 19 August the Liberian National Oil Company (NOCAL) held an international roadshow in London where it presented the oil blocks currently under a bid round to a packed room of international investors. The London event is the first of three roadshows designed to attract investment into the four offshore oil blocks recently re-opened by NOCAL for bidding (LB-6, LB-7, LB-16 and LB-17). It will be followed by roadshows in Houston on 21 August and in Lagos on 23 September.
The NOCAL-led bid round will promote development of the vacant offshore oil blocks, generate revenue for Liberia and also lay foundations for developing Liberian domestic industry and employment. It is being conducted with assistance from Ernst and Young and TGS Nopec.
Following international best practice, the bid round is open, competitive, and requires that investors pre-qualify to meet high standards. Successful bidders would join some of the world’s top exploration companies already in Liberia, including Chevron and ExxonMobil.
Companies which meet the pre-qualification criteria will bid for Production Sharing Contracts (PSCs) to explore and develop the four available blocks. Qualified bidders will be evaluated on Signature Bonus and their commitment to build local Liberian capacity.
The bid round is the first of its kind to give preference to bid groups that contain companies from Liberia and the ECOWAS region, which will open the way for mentoring and development of Liberian companies.
The Chief Operating Officer of NOCAL, Cllr Althea Sherman, who is coordinating the current bid round said:
“We are proud to be offering this acreage – which has great prospects. Liberia is facing a terrible health crisis as we speak, making it all the more important that we secure the long-term growth of our country. We have attracted some of the world’s best companies to date, and we hope that this transparent, competitive round can attract more. It will also enable us to develop these vacated blocks while we complete our reforms of the sector and before any new acreage is made available.”
Since Liberia's deep-water exploration program began in 2004, six wells have been drilled including by Anadarko and supermajor Chevron. Several wells have found petroleum but none have yet led to commercial development and production is still at least 5-10 years away.
Liberia has 30 blocks in total: 17 offshore and 13 ultra-deep. The 17 offshore blocks (LB-01 to 17) lie in two geological basins (Liberia Basin and Harper Basin) and of these, blocks LB-06 to LB-17 (including the four being re-opened) have been the subject of past bid rounds.
Block LB-16 and LB-17 were part of the 2005 Liberia Basin Bid Round. No drilling took place in either block and the production sharing contracts that covered the blocks were relinquished by Anadarko and its partners in 2012 and 2013.
Blocks LB-6 and LB-7 were part of the 2007/8 Liberia Basin bid round. No production sharing contracts for those bid rounds ever became effective, and no drilling or exploration took place. In 2013 NOCAL terminated efforts to reach agreement with the party granted the opportunity to negotiate production sharing contracts for those blocks, and declared the blocks available for a subsequent bid round.
The Harper Basin blocks (LB-01 to 05) have never been leased, and are subject to a 2012 moratorium over licensing any new acreage before a new Petroleum Law is enacted.
Ernst & Young (EY) is advising NOCAL on the structuring of the current bid round. EY is assisting NOCAL in developing the fiscal model that will be used to evaluate bidder submissions, and will receive, review and make recommendations to NOCAL with respect to pre-qualification submissions from prospective bidders. EY will also receive and open the bids received and will provide NOCAL with EY’s evaluation of the fiscal terms contained in each bid. NOCAL expects that EY’s involvement in this bid round will ensure that companies are treated fairly and equally, that prequalification decisions are made on an objective basis, and that the terms of all bids are fully disclosed.
TGS is a world-wide company headquartered in Norway that provides global geoscientific data products and services to the oil and gas industry to assist with licensing rounds and the preparation of regional data programs. TGS has assisted NOCAL with its bids round since its original 2004 round and has a deep understanding of the geological prospectivity of the Liberia Basin, in which the four blocks on offer are located. TGS has advised NOCAL on the structuring of this new bid round, is assisting NOCAL in publicizing the bid round to prospective bidders, and will supply prospective bidders with the available seismic data for the four blocks on offer.
For the current bid round, pre-qualified companies are invited to bid for Production Sharing Contracts on the basis of up-front signature bonus. Bidding groups that also include a Liberian participation will receive a 20% uplift in their signature bonus bid.
Cyrus Wleh Badio
Director Public Affairs
Tel: +231 886 454128
National Oil Company of Liberia (NOCAL)
Episcopal Church Plaza
Ashmun & Randall Streets