29 April 2014

Liberia: NOCAL Threatened With Protest

The Independent Authoritative Heritage has reliably learnt that hundreds of Liberians in Monrovia and its environs are planning a protest against the National Oil Company of Liberia(NOCAL) if NOCAL goes ahead to sell four oil blocks to a Chinese company as reported in the media.

NOCAL is regarded as the independent state owned enterprise created by the NOCAL Act of 2000 and mandated to coordinate the development of Liberia's oil sector.

According to information available to this paper, those planning the protest against the Liberia's oil company say they will oppose the sale of any oil block until the well-publicized new Oil Law, which is currently before the Legislature, is passed into law.

"In the absence of the passage of the new Oil Law, the sale of any oil block will be at the detriment of the poverty stricken Liberians and on the other hand, will benefit the elite," the report gathered by the Heritage quotes the planners of the demonstration as asserting.

The report accentuates that those planning the demonstration contend that the mass Liberians are yet to benefit from the huge resources NOCAL is generating from the oil sector, and so they will ensure through peaceful means that the oil company does not turn the table around in the absence of the passage of the new Oil Law.

If the planned protest against NOCAL goes ahead, it will not be the first time for Liberian citizens to protest against the oil company. It could be recalled that late last year, a group of Liberians protested in Harper City, Maryland County against what they called the "wicked form and manner" NOCAL was operating the country's oil sector.

The protesters, mostly youth, carried out the protest in the presence of dozens of lawmakers who had gone to southeastern Liberia, including Maryland County to educate the people about the ongoing reforms in the oil sector.

But the protesters averred that it was "inhumane and selfish" on the part of the lawmakers to seek their personal interest above the "overall interest" of the Liberian people who elected them.

Some of the protesters voiced out: "You have come to preach to us about reforming the oil sector after benefiting hugely from NOCAL. You have forgotten us who elected you. This oil reform is intended to benefit the elite and not the poverty stricken Liberians."

During the protest, the protesters held placards. Some of the inscriptions of the placards read: "Hon. House, an attempt to pass this devilish bill will kick you out of Liberia, Keep our 7 blocks if no 20% plus 10%, We need compensation for our lands, Liquefied petroleum gases must be for Liberians exclusively."

Accordingly, the new Oil Law seeks to do four main things: create an oil policy bureau under the supervision of the Ministry of Lands, Mines and Energy; create a regulatory bureau sorely responsible to regulate the oil sector, with NOCAL remaining as it is to serve as the commercial arm of the sector. The oil reform also seeks to repartition the oil block to international standard.

When the new Oil Law is rectified by the House of Representatives, and subsequently concurred by the Senate, it will take 90 days before it takes effect. The law will split the current NOCAL authority into three equal halves and will put the bid-process under the regulatory bureau.

The report of the planned protest against NOCAL followed a publication by this paper on Monday, April 28 that the Legislature had reportedly given the green light to the oil company to sell four oil blocks to a Chinese company under the pretext of "re-assigning" them.

In our publication, which was based on credible report obtained from well-placed legislative sources, we reported that, while these reforms are taking place, the laws prohibit for any oil block to be sold by NOCAL.

Oil block (s) will only be sold following the passage of the reform laws by the Legislature. Before the commencement of the ongoing reforms of the oil laws, NOCAL sold oil block 13 to Exxon Mobil(XOM) and Canadian Oversea Petroleum. Block 13 transformed from Pepper coast Petroleum formerly known as Broadway Consolidated Ltd.

Among other things, the renegotiated contract yielded US$50 million upfront to Liberia through a combination of taxes and transferred fees.

But some international observers had described as a drop in the ocean the US$50 million paid for block 13.

According to the international observers, oil is a lucrative business, and so, the government needed to have sold block 13 for about US$450 million as it is done in South Sudan.

"In South Sudan and other African Countries, which God blessed with oil, an oil block is sold for huge amount and not peanut as in the case of Liberia, making specific reference to the sale of block 13," they asserted.

Liberia has not yet made a commercial discovery of oil, but in February 2012 African Petroleum (API) announced a significant discovery in LBO9.

We further reported that the four oil blocks the Legislature, which is considered as the First Branch of Government, supposedly gave NOCAL the green light to sell are: 6, 7, 16 and 17.

Our report divulged that the Legislature gave the green light to NOCAL based on account that the Government of Liberia(GOL) had pleaded that it was in desperate need of money owing to the budget shortfall.

Reports say most of the government sponsored projects are currently at a standstill due to the budget shortfall.

Accordingly, our report further divulged that NOCAL had formulated an idea that the four oil blocks in question will be "re-assigned" instead of saying it will be sold.

A strategy, our sources averred, the lawmakers are said to have embraced. "This idea designed by the oil company is intended to give the public the impression that the four oil blocks will not be sold, but will be reassigned. By saying so, it will make the public not to go against NOCAL when the issue surfaces in the public via the media," our sources further averred.

Quizzed about the expected value of the four oil blocks when sold, our sources asserted that it could be around US$200 million since block 13(single block) was sold for US$50 million.

When further quizzed as to when the deal will be consummated, our sources added: "Very soon because NOCAL has already been given the green light to carry out the transaction."

But when asked to comment on the information obtained by the Heritage, NOCAL's Vice President for Public Affairs, LaminiWaritay, said the only information he is aware of regarding Blocks 6 & 7, is that whatever negotiations that had been going on between Hong Kong TongTai Petroleum International and NOCAL had been terminated since August 2013. As to whether these same blocks and those of block 16 & 17 are now being "re-assigned" to another Chinese company, according to Heritage's information, he said he is not aware of that.

For his part, the Deputy Speaker of the House of Representatives, Hans Barchue, when contacted by the Heritage, said he is not aware of the information obtained by the paper.

Lawmaker Barchue, who is currently serving as Acting Speaker, maintained that he is not aware of such information.

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