LONDON – Liberia’s current invitation-only bidding round has ignited interest among international oil companies, said GlobalData. However, the Ebola virus outbreak and Liberia’s poor infrastructure will pose challenges to the round.
Since being announced on Aug. 5 this year, Liberia’s bid round, which offers offshore blocks LB-6, LB-7, LB-16, and LB-17, in water depths ranging from 500 m (1,640 ft) to 3,800 m (12,467 ft), has been extended to Nov. 14.
According to Gustavo Bianchotti, GlobalData’s senior upstream analyst covering Europe, the Middle East and Africa, no commercial discoveries have been made in Liberia to date, but oil traces have been found in 13 wells since the early 1970s. An active exploration program has resulted in three confirmed oil discoveries from six wells, and releasing the data from the remaining wells would attract more attention to Liberia’s bid round.
Bianchotti says, “The country’s entire exploration activity is presently offshore in the Liberia basin, which consists of 30 blocks. While none of the blocks offered in the current bidding round have been drilled, seismic studies suggest that there is hydrocarbon potential in the basin’s Middle to Upper Cretaceous fan systems.”
In 2013, the first new terms were introduced in Liberia, which entitled companies to a 50% participation share and eligibility for dividends payments if commercial discoveries culminated in production.
Bianchotti concludes that, as there are 18 offshore blocks available for subsequent rounds.