The former President of the National Oil Company of Liberia (NOCAL), Mr. Christopher Neor, has challenged the current administration of the company not to hide the truth in the management of Liberians' expectation. According to Mr. Neor, telling the truth in the management of Liberians' expectation helps to build confidence and erase negative perception and misinformation.
In a recent telephone interview with The News from abroad, the former Energy Advisor to President Ellen Johnson-Sirleaf said although NOCAL is doing a good job by helping to reduce the Liberian people's expectation concerning the discovery of 840 million barrels by the Australian giant, African Petroleum, but he further challenged the oil company to manage the expectation by telling Liberians the truth at all stage of the oil agreement.
The former CEO of NOCAL's comments came in the wake announcement by AP that it had commenced drilling into two oil wells, which are situated off the coast of Liberia. The Australian oil giant revealed that it started drilling its Bee Eater-1 well offshore Liberia. The Bee Eater-1 well, according to AP, is located 9.5 km north west of the 2012 Narina discovery which discovered high quality oil in Turonian reservoirs.
In a statement, the AP's Chief Executive, Karl Thompson, put the commercial value of the Bee Eater oil deposit at about 840 million barrels. He stated that the second well in this drilling program will be drilled after the completion of the Bee Eater-1 Well. The CEO of AP boasted that the year 2012 was a very successful year for the company with the Narina-1 discovery in Liberia and the expansion of the company's exploration portfolio in addition to five more exploration blocks in Senegal, Sierra Leone and Cote d'Ivoire.
However, following the announcement by AP, NOCAL issued a press release, welcoming the latest progress in the drilling program of AP. But NOCAL reemphasized that AP is in the process of appraising their discovery, which they announced in February (2012). Only further drilling will determine if there are commercial quantities of oil and that the announcement by AP was intended to inform the public, as required by all public companies, about the potential prospects of its ongoing appraisal program.
"Oil and gas exploration phases include exploration drilling, appraisal, development, production and decommissioning. The process from exploration to exploitation on average, takes at least 5-7 years." NOCAL explained. Said NOCAL in the press release: "The ongoing appraisal drilling by AP is aimed at evaluating the size and nature of their reservoir to determine the number of confirming or appraisal wells required, and not for production as is being reported. This appraisal drilling program will determine whether potential discovery in Block LB-09 is commercially viable (as determined by the terms of the agreement), which could eventually ensure a progression to the development phase."
NOCAL reiterated that even if the ongoing appraisal programmes determine the commercial viability discoveries, commercial production of oil in our off shore basin may yet be a decade away. Speaking further, Mr. Neor told The News that the purpose of managing state resources is to ensure that the resources benefit the Liberian people. He cited several mining concessions including the Bomi Hills that later became "Bomi holes" due to poor management.
When the paper quizzed him as to whether the announced 840 barrel means Liberia is closed to producing oil, Mr. Neor responded, saying Liberia is still far away as African Petroleum still has other stages before production. The Liberian energy expert said it would take African Petroleum between four to seven years to reach the production stage. According to him, this kind of investment involves millions or sometimes billions of dollars, and it is highly risky, especially when the amount spent to reach production cannot be recovered. However, he called on Liberians to remain prayerful, hoping that in the coming years the commercial value of oil would be known.