By Lansana Fofanah
The Petroleum Directorate Sierra Leone yesterday organized a one-day consultative stakeholder’s conference at the Bintumani Hotel, Freetown, with the aim of giving a facelift to the oil and gas industry.
Representatives of various ministries and agencies together with investors discussed potential opportunities in the sector and how to surmount challenges that would lead to a win-win situation.
Addressing stakeholders, the Director General of Petroleum Directorate, Timothy Kabba explained the rapid transformation the Directorate is undergoing and stated that the consultative dialogue was meant as an appropriate step for the development of way-forward and strategies intended to reignite the dormant petroleum sector. “The recent commercial discoveries in geological basins similar to our own have ushered in the re-emergence of exploration activities and the rapid development of new oil and gas provinces in the West African region are shaping a promising future for our community at large and for Sierra Leone in particular.
The rebirth of oil and gas companies’ interest in exploration has given rise to an astronomical number of countries availing varying forms of tender options in an effort to capture a portion of the limited investment dollars now available. We at the Petroleum Directorate are committed to promoting the high commercial probability of our petroleum assets and to distinguish the competitiveness of our program from those that are comparatively positioned in an effort to attract best in world-class development partners who have proven commitment to technical excellence and environmental protection”, he said. He said that the establishment of a ‘new Petroleum Directorate’, with a strong mandate to transform the governance and policies will effectively manage the sector and bring the benefits of oil to Sierra Leoneans as broad based stakeholders participation is crucial to good governance
Highlighting goals and commitments of the PD, he said, that attracting world class operators to lead exploration in Sierra Leone, improving upon the legal and regulatory framework and building the local technical capacity to monitor and support operations through academic and professional trainings are key to their success “Sierra Leone experienced its first petroleum exploration in the 1980s when the government awarded the country’s first exploration contracts to Mobil and Amoco. Two (2) wells were drilled, one in 1982 by Mobil and the other in 1985 by Amoco. Although both wells proved to be non-commercial, both showed evidence of source rock types and the presence of good quality oil. Unfortunately, the sector lay dormant until the early 2000s, when the government sought to restart exploration activities by acquiring 5,800 Sq. Km. of 2D seismic data.
This renewed international interest in Sierra Leone and served as the impetus for the Petroleum Exploration and Production Act (2001).
In 2001, PEPA 2001 was passed by Parliament to govern petroleum operations; thereby, establishing the Petroleum Resources Unit (PRU) to regulate and monitor petroleum operations. In 2003, the first Bid Round was executed; four offshore exploration blocks were offered and awarded to bidding Companies.
In 2004, Sierra Leone held its second Bid Round where one (1) exploration block was awarded. In addition, Repsol Exploration acquired 3-D Seismic data (2003 – 2004). An additional one exploration block was awarded in 2006 through direct negotiation.
In 2010, the Sierra Leone Petroleum Policy was created followed by the Petroleum (Exploration and Production) Act 2011, replacing the PEPA 2001.In 2012; the third licensing round awarded 8 Blocks. Of this, a total of 8 wells were drilled, (6 wells between 2009 and 2013 with 4 discoveries). Those four discoveries were Venus – B1, Mercury 1, Savannah 1X, and Jupiter-1. Although those discoveries were not declared commercial, each proved the presence of working hydrocarbon systems in the margin and spurred a flurry of exploration activities,” he emphasized.
The Principal Deputy Financial Secretary in the Ministry of Finance, Matthew Dingie, said that prior to the establishment of the Treasury Single Account, the Ministry had little or no knowledge about financial capacity of the Petroleum Directorate. But with that mechanism, the Ministry is fully aware of the operations of the Directorate. He said that the sum of Le 2.3 Billion Leones has been disbursed by the Ministry for the construction of the Directorate’s office which shows government commitment towards the empowerment of the sector.
The Presidential Adviser on Trade and Investment, Dr. Abdul Karim, assured that his role has always been to advise the President judiciously on trade matters and he allayed the fears of investors that their investments are safe and sound in Sierra Leone.
The Minister of State, at the Office of the Vice President, Madam Francess Algali, said that in the past, civil society organizations and the media used to ask demanding questions. But the open-door policy of the new Directorate has given more confidence to the public that they are doing a great job in ensuring that Sierra Leoneans start using their own fuel product soon. Mr Amadu Mansaray, Senior Administrative Manager said that much has not been done to change the views of the people about the sector and the stakeholder’s conference is the first in the history of the Directorate. He said that every key player in the industry must play his or her own part to achieve a common goal.