Monday, February 20, 2012

‘Significant’ Oil Discovery in Liberia!!

Written by Rodney D. Sieh

Source: Front Page Africa

Monrovia - After decades  of trying to find the elusive fossil fuel known around the world as black gold, Liberia finally hit pay dirt when African Petroleum Company, an Australian-British Company announced late Monday night that it has discovered commercial quantities of oil in Liberia.  Sources at the National Oil Company of Liberia (NOCAL) have confirmed the discovery which was announced by the Australian Stock Exchange.

‘Significant Discovery’

The discovery by African Petroleum Corporation Limited was reportedly made at Narina--‐1 well, offshore Block LB--‐09.

A statement by African Petroleum reported that the company has found a total of 32 metres (105 feet) of net oil pay in two zones: 21  metres (69 feet) In the Turonian; and 11 metres (36 feet) in the Albian. Good quality oil was found in each of the Turonian And Albian reservoirs of 37 degrees API and 44 degrees API, respectively.

“Hydrocarbon  shows were encountered over a 170 metre interval in the Turonian and no oil water  contact was found,” the company reported.

The discovery, according to APC confirms the prospectivity of both of these highly successful West African exploration plays.

The report noted that on African Petroleum’s Blocks LB--‐08 and LB--‐09, covering 7,135 sq km. Oil  was found in good quality reservoirs in a Turonian submarine fan system extending across a prospective area of 250 sq km. In addition, excellent quality oil was found in the Albian sands nearby to a very large Albian submarine fan prospect.

Continued the statement: “In the shallower Campanian, Santonian and Coniacian horizons, 216 metres (709 feet) of water bearing net reservoir sands were encountered.  Whilst hydrocarbons were not expected due to absence of a prospect trap, the confirmation of Good quality thick reservoir sands significantly reduces the risk in a number of large prospects covering 500 plus sq km, at these levels which are known to be oil bearing in the region. In the deeper Cenomanian and Albian 300 metres of source rocks were encountered which will be incorporated into The regional geological model to high grade the prospect portfolio as well as the surrounding open acreage.”

APC reports that the Narina--‐1 well was drilled by the Maersk Deliverer to a total depth of 4,850 metres (15,912 feet), in a Water depth of 1,143 metres (3,750 feet) taking 43 days for completion.

African Petroleum owns 100 per cent of Liberia offshore Blocks LB--‐08 and LB--‐09.

Karl Thompson, African Petroleum’s CEO said: “Narina--‐1 has identified a potentially large accumulation of light good quality oil at the Turonian level, as well as excellent quality oil in the Albian. Additionally, the  well found thick reservoir sands in shallower zones and thick source rocks which together with the discoveries in the Turonian and Albian has transformed the prospectivity of Blocks LB--‐ 08 and LB--‐09, and the surrounding open acreage. African Petroleum has again drilled a very cost effective well, without incident and has established itself amongst the leading operators in deepwater exploration. The Company is focusing on sourcing rigs and we are planning an extensive exploration and appraisal programme in Liberia during 2012.”

Major Milestone

Although it could take as long as five years to start pumping black gold and managing public expectation, yet the discovery is a major milestone for the country that has seen little good economic news over the last three decades of conflict that saw hundreds of thousands of Liberians killed, with more than three quarters of the population internally or externally displaced.

African Petroleum is principally owned by Vasile Frank Timis, a Romanian émigré who left his own conflict torn country nearly three decades ago to find his fortunes in Australia. Now an Australian citizen with vast wealth mainly from mining and oil projects around the globe, he was recently named one of the richest people in the UK with a net worth of 600 million pounds, or nearly one billion dollars.

Timis started his own transport company in Australia, which owned only one truck driven by himself and in 1992, he became the CEO of Morwest Holdings Pty Ltd and the first of his business in the gold mining industry. Timis and two Australian miners dug for six months for gold in a region called Mosquito Creek. During this time he founded  three other companies: Riverdale Mining, Timis Corporation and Carpathian Investments, together with Ioana Timis and his sister, Ioana Majdik.  Frank Timis, despite many challenges in his life has made great strides in the mining in oil industries.  Currently, Timis is on the verge of exploiting Tonkollili, a potentially ten billion iron ore mine in Sierra Leone.

Avoiding Dutch Disease and Resource Curse

Now that Liberia has discovered oil, analysts say the country must develop structures to avoid the Dutch diseases and resource curse.  The Dutch disease is overreliance on a mineral resource to the neglect of other sectors in a country’s economy.  The resource curse is what has befallen many developing nations with abundant resources, yet mire in poverty and conflict.

Samuel P. Jackson, a Liberian economist and business development specialist with years of experience close to Liberia’s resources sector say Liberia must begin to develop a framework, which ensures that hydrocarbon development is integrated within the economic mainstream of the country by creating programs that broaden participation of Liberians to the maximum extent feasible.  In order to create such programs, it is necessary to understand the current organizational framework for hydrocarbon development, major antecedents in the sector, prospects for future oil and gas discovery and the current status of the country’s oil program, including major actors in the evolving value chain.  Additionally, Mr. Jackson warns that the country’s planners should not neglect other sectors of the economy, and in fact should try to deepen economic activities in other areas in order to diversify to avoid exogenous shocks due to volatility in the prices of oil on the international markets.  

NOCAL set to Play a Leading Role

Hydrocarbon development in Liberia is regulated by NOCAL under the New Petroleum Law of Liberia, which was signed into law in June of 2002 and published by the Ministry of Foreign Affairs in July of the same year.  It provides the regulatory basis for hydrocarbon development, with provisions and definitions on participants in the country’s oil and gas industry and sets out clear guidelines for Liberian official participation, via equity and makes provisions for local content.  It also establishes the basis for relationships between NOCAL and licensees for petroleum acreages, through blocks and fields and proposes a production sharing arrangement in the exploitation phase of hydrocarbon development.

Recent changes at NOCAL may portend fundamental changes in how the corporation does business.  It is unclear how the corporation will develop going forward, either as a regulator of the hydrocarbon sector, or a key participant in the upstream and downstream on the Angolan model, such as SONANGOL, Petro bras in Brazil or ARAMCO in Saudi Arabia.

As of now, the country should relish its new found status as a future oil producing nation, but it should never lose sight of the major challenges going forward.

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Inside Liberia with Bernard Gbayee Goah

Everyone is a genius

Everyone is a genius. But if you judge a fish on its ability to climb a tree, it will live its whole life believing that it is stupid. – A Einstein

Drawing the line in Liberia

Crimes sponsored, committed, or masterminded by handful of individuals cannot be blamed upon an entire nationality. In this case, Liberians! The need for post-war justice is a step toward lasting peace, stability and prosperity for Liberia. Liberia needs a war crimes tribunal or some credible legal forum that is capable of dealing with atrocities perpetrated against defenseless men, women and children during the country's brutal war. Without justice, peace shall remain elusive and investment in Liberia will not produce the intended results. - Bernard Gbayee Goah

Men with unhealthy characters should not champion any noble cause

They pretend to advocate the cause of the people when their deeds in the dark mirror nothing else but EVIL!!
When evil and corrupt men try to champion a cause that is so noble … such cause, how noble it may be, becomes meaningless in the eyes of the people - Bernard Gbayee Goah.

If Liberia must move forward ...

If Liberia must move forward in order to claim its place as a civilized nation amongst world community of nations, come 2017 elections, Liberians must critically review the events of the past with honesty and objectivity. They must make a new commitment to seek lasting solutions. The track records of those who are presenting themselves as candidates for the position of "President of the Republic of Liberia" must be well examined. Liberians must be fair to themselves because results from the 2011 elections will determine the future of Liberia’s unborn generations to come - Bernard Gbayee Goah

Liberia's greatest problem!

While it is true that an individual may be held responsible for corruption and mismanagement of funds in government, the lack of proper system to work with may as well impede the process of ethical, managerial, and financial accountability - Bernard Gbayee Goah

What do I think should be done?

The situation in Liberia is Compound Complex and cannot be fixed unless the entire system of government is reinvented.
Liberia needs a workable but uncompromising system that will make the country an asylum free from abuse, and other forms of corruption.
Any attempt to institute the system mentioned above in the absence of rule of law is meaningless, and more detrimental to Liberia as a whole - Bernard Gbayee Goah

Liberia's Natural Resources
Besides land water and few other resources, most of Liberia’s dependable natural resources are not infinite, they are finite and therefore can be depleted.
Liberia’s gold, diamond, and other natural resources will not always be an available source of revenue generation for its people and its government. The need to invent a system in government that focuses on an alternative income generation method cannot be over emphasized at this point - Bernard Gbayee Goah

Liberia needs a proper system
If Liberians refuse to erect a proper system in place that promotes the minimization of corruption and mismanagement of public funds by government institutions, and individuals, there will come a time when the value of the entire country will be seen as a large valueless land suited on the west coast of Africa with some polluted bodies of waters and nothing else. To have no system in place in any country is to have no respect for rule of law. To have no respect for rule of law is to believe in lawlessness. And where there is lawlessness, there is always corruption - Bernard Gbayee Goah

Solving problems in the absence of war talks

As political instability continues to increase in Africa, it has become abundantly clear that military intervention as a primary remedy to peace is not a durable solution. Such intervention only increases insecurity and massive economic hardship. An existing example which could be a valuable lesson for Liberia is Great Britain, and the US war on terror for the purpose of global security. The use of arms whether in peace keeping, occupation, or invasion as a primary means of solving problem has yield only little results. Military intervention by any country as the only solution to problem solving will result into massive military spending, economic hardship, more fear, and animosity as well as increase insecurity. The alternative is learning how to solve problems in the absence of war talks. The objective of such alternative must be to provide real sustainable human security which cannot be achieved through military arm intervention, or aggression. In order to achieve results that will make the peaceful coexistence of all mankind possible, there must be a common ground for the stories of all sides to be heard. I believe there are always three sides to every story: Their side of the story, Our side of the story, and The truthBernard Gbayee Goah


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