Liberia: Neyor Calls For NOCAL, LPRC Merger to Attract Investors
Monrovia – Ahead of the official opening of bid rounds for offshore oil blocks in the country, the former President and Chief Executive Officer (CEO) of the National Oil Company of Liberia, Mr. Christopher Neyor has called for the merger of NOCAL and the Liberia Petroleum Refining Company (LPRC) in order to attract investment opportunities to the country’s oil and gas sector and curtail the scarcity of gasoline.
Report by Obediah Johnson, [email protected]
Mr. Neyor is now an International Energy Expert and the President of Morweh Energy Group Incorporated.
It can be recalled that in December 2019, the Government, through the Liberia Petroleum Regulatory Authority (LPRA), announced the launch of the next licensing round for several oil blocks expected to commence in April this year.
The decision was reached following a meeting held between executives of NOCAL, LPRA and TGS, whis is a geo-physical company hosting Liberia’s offshore seismic data and rendering technical support.
Nine offshore oil blocks are expected to be on offer in the Harper Basin, one of the last unexplored and undrilled regions offshore West Africa.
In a dispatch from the United States of America, Mr. Neyor claims that Liberia’s oil and gas sector has been restructured to the extent that NOCAL has been stripped off much of its multiple functions and power.
He added that NOCAL no longer has a regulatory function to launch and supervise bid rounds, evaluate them and award contracts.
He pointed out that this function has been given to the Liberia Petroleum Regulatory Authority (LPRA), while the policy mandate of NOCAL has returned to the Ministry of Lands, Mines and Energy.
Mr. Neyor disclosed that the generation of revenue by NOCAL has also been moved to the Liberia Revenue Authority (LRA).
“The Complete Merger of LPRC and NOCAL was one of the mandates I had when I was sent to NOCAL as spelled out in the Liberia National Energy Plan. It is highly recommended that focus should be placed on consolidating the capacity of NOCAL and the LPRA by resurrecting some of the bilateral assistance that was active before or in progress,” the former NOCAL boss wrote.
He added that the dissolved LPRC would then become the upstream division of NOCAL headed by an Executive Vice President and General Manager.
The Liberian energy expert further noted that the economic analysis of the merger showed that the value of the combined companies would have been greater than the sum of the value of the individual entity when left alone.
He stated that the recommended merger of NOCAL and LPRC must be pursued vigorously for the economic and strategic benefits to be derived.
“The Complete Merger of LPRC and NOCAL was one of the mandates I had when I was sent to NOCAL as spelled out in the Liberia National Energy Plan. It is highly recommended that focus should be placed on consolidating the capacity of NOCAL and the LPRA by resurrecting some of the bilateral assistance that was active before or in progress.”– Christopher C. Neyor, Former President of the National Oil Company of Liberia
Allocation of Oil Blocks to NOCAL
Mr. Neyor maintains that under normal circumstances, the allocation of one or two oil blocks to NOCAL by the LPRA would enable the company to partner with a reputable oil company and build capacity as a joint operator.
For such allocation to derive optimal benefits, he added, NOCAL must have an acceptable level of oil and gas professionals in its employ and the government ensures the allocation is effected in a transparent manner.
“Oil and gas transactions are often awash in cash and anyone who was a pauper yesterday or has a pauper mentality will go crazy seeing such money floating around and would make deals inimical to the country for a few dollars,” Neyor said.
“We do not want the oil block allocation to NOCAL be used to front for unscrupulous individuals and companies”.
The former NOCAL President/CEO recalled that in 2009 he was the lead consultant on the Liberia National Energy Plan (LNEP) which, at the time, met the Cabinet endorsement as the official GOL blueprint for advancing the energy sector.
According to him, the LNEP had a legislative component, which called for the establishment of relevant entities through enactment by lawmakers, including the Energy Regulatory Board (ERB).
“This was thoughtfully accepted by all stakeholders for its economy of scale and cost saving consolidation through validation workshops of the policy document around the country”.
Mr. Neyor disclosed that contrary to the government’s endorsed policy validated by nationwide stakeholders, it (government) submitted to the Legislature an Electricity Regulatory Authority and later a separate Petroleum Regulatory Authority.
He pointed out that though policies are not engraved in stone and can be changed, the change effectuated was not accompanied with valid reasons.
Mr. Neyor also indicated that the building of capacity is very vital in the nascent oil and gas industry of Liberia, but said “this key area has faltered due to corruption and mismanagement in the past”.
He pointed out that NOCAL “took some of the money allocated for human development and decided to sponsor football teams buying sporting gears at inflated prices one of which became public when a vendors they had cut a deal with decided not to play ball as they had agreed behind closed doors”.
“No one was ever investigated or persecuted for such economic crimes until NOCAL went bankrupt,” he added.
Mr. Neyor recalled that under his administration at the state-owned oil company, a scholarship scheme named and styled “15/12 scholarship scheme” was initiated.
He noted that the program was intended to recruit about 12 students from each of the 15 counties for five years, with 10 of them given non-binding local scholarships in any field and two overseas binding scholarships in various areas relevant to the operation and management of the oil and gas industry of the country.
He stated that in its first year, almost 30 students were sent to various universities in the United Kingdom, the United States and other countries for graduate studies in petroleum law, energy economics, oil and gas accounting, environmental science, geophysics, among others.
Mr. Neyor added that many of those students graduated, returned to Liberia, but many of them were let go when NOCAL collapsed.