The Battle for the Sale of Oil Block-13 and Budgetary Sustenance
The National Oil Company of Liberia is currently at the center of the debates in several quarters of the Liberian society. Initially, the debate was on the basis of personality, and the man on whom such debate was focus was Mr. Robert Sirleaf.
Following his appointment by the President as Chairman of the Board of Directors of NOCAL, condemnations came from a few quarters because as a son of the President, he should have not been preferred to that institution by his mother.
The irony about the matter is that not that Mr. Robert Sirleaf is not qualified or up to the task for the job, they did not just want him there because he is the son of the President who was now presiding over Liberia’s oil which they though would have been “drilled a few days” after Sirleaf’s appointment as Chairman of the Board. And the unfortunate situation about the whole matter was that most of those who raised the personality issue were the same who had within the employ of their entity, institutions or organizations relatives such as brothers, sisters, cousins, as well as uncles, and aunts placed in strategic positions without the requisite capacities.
One would have thought the issue should have been the ability of Mr. Robert Sirleaf to ensure the interest of the people of Liberia considering the threats posed by oil exploration in a poverty-stricken African nation as it is with the Nigerian situation in West Africa. Instead, Robert Sirleaf as a son of the President was the matter, something many viewed as a non-issue.
Currently, the debate is about the interest of Liberia and its people as raised by the House of Representatives during the past weeks. At the core of this debate between the House and Executive, represented by the National Oil Company of Liberia is the issue of the sale of Oil Block 13 for either US$27m or US$12.5m. The argument of the Representatives is directed at the US$27m put forth by Pepper Coat in opposition to the Executive’s preference of US$12.5m proposed by Chevron.
The focus of this article is not to delve into the entirety of Liberia’s oil and gas sector for now, but to wonder why a US$12.5m would be preferred to US$27m. From a simple logic, the entire Liberian nation would go for the latter because it is more and would contribute immensely to the 2011/2012 National Fiscal Budget which is now under the threat of experiencing short-fall due to the row over oil block 13.
On the other hand, there is reason to prevent the American-owned Chevron from purchasing the block if it is will to pay US$27m or a substantial amount of cash. The primary reason for this could be that Chevron owns the two oil blocks between which block 13 is located, and for concerned economic and security reasons, it could pay the US$27m or pretty close to that and take delivery of the oil block.
But the bickering characterizing the sale of that particular block in favor of Chevron’s US$12.5m is creating some suspicion being harbored by members of the House of Representatives about the whole deal. Other than, there should be no other reason for anyone to suggest that US$12.5m is better than US$27m. Except where the fear may be that Chevron is an American Company and knowing what America does for oil against other oil-rich nations, the government must go for the former.
Realistically, it is fair for that deal to favor Pepper Coat given the financial benefit to the government, other than Chevron whose offer may be impregnated with financial exploitation.
The only cause to worry about this deal is the sincerity of the lawmakers. Many may be holding the suspicion that they may be advancing these arguments for very attractive kick-backs as it has allegedly been in the immediate past with other agreements.
But again, they must be given the benefit of the doubt to fight on in the interest of the country because that amount is not available for the 2011/2012 Fiscal Budget, the government will surely experience revenue short-fall and would be unable to meet some of the needs of the people of Liberia.