Monrovia - The pillars of Liberia’s economy have been shivering over the past three years with the slump in prices of rubber and iron – Liberia’s two main export commodities – on the world market.
With the country being unable to raise its current national budget from traditional revenue sources, and now shifting the burden on citizens with the imposition of additional taxes, the discovery of oil, which was highly anticipated through ExxonMobil’s recent exploration of deep-water Mesurado-1 exploration well, was a breath of hope for Liberia’s economic survival.
Unfortunately, Liberia has to look elsewhere and re-strategize, if she should regain her economic footings.
ExxonMobil which recently explored Block LB-13, 50mi offshore Liberia in 2500m water depth using Seadrill's West Saturn drillship, on 21 November, has expressed disappointment over the absence of hydrocarbons in the well.
According to media report, ExxonMobil has advised its partner, Canadian Overseas Petroleum (COP) that no further logging operations will be done and that the well will be plugged and abandoned.
The well, targeting oil in a sequence of Late Cretaceous Santonian aged sands, intersected 145m (475ft) of net sand of which 118m (387ft) was deemed to be reservoir quality. But, no hydrocarbons were indicated by the logging while drilling operations performed across the targeted intervals.
"We are naturally disappointed by the lack of hydrocarbons in the targeted reservoir sands in the Mersurado-1 well," COP CEO Arthur Millholland is quoted as saying.
"The targeted Santonian sand sequence and thickness intersected was in accordance with our seismic interpretation.
The lack of hydrocarbons at this location, where our seismic data presented attributes indicative of hydrocarbons will cause us to do additional work on the 3D seismic over the block, and reevaluate the other leads we have mapped on LB-13."
Millholland added: "The Company holds an attractive oil appraisal and development project offshore Nigeria on OPL 226.
Appraisal drilling operations are planned to commence in late 2017. These operations will continue to add value to the company."
Hopes Were High
On November 29, President Ellen Johnson Sirleaf, being hopeful of hydrocarbon prospects, toured the Mobile Offshore Drilling Units of ExxonMobil positioned at Oil Block-13.
President Sirleaf along with delegation was air-lifted from the James Spriggs Payne Airport in Sinkor Monrovia to West Saturn offshore platform where exploratory drilling was ongoing.
During the guided tour, President Sirleaf received briefings and interacted with personnel working on the offshore platform.
She was accompanied by Lands Mines and Energy Minister, Patrick Sendolo, Deputy Chief of Staff and Head of President Delivery Unity (PDU), Dr. Clarence Moniba, Flight Ops Manager of the Liberia Civil Aviation Authority (LCAA), Capt. K. Moses Weefur, among others.
Previous Explorers Pulled Out
Also in November 2016, the West Africa-focused oil and gas company, African Petroleum pulled out of Liberia – citing challenging market conditions for exploration and lack of commercial discoveries in Liberia.
The company could also not find new partners to continue its offshore prospects exploration.
Production-sharing contracts for the LB-08 and LB-09 blocks formally expired in June, and African Petroleum had been in negotiations with the Liberian authorities for an extension to allow it time to seek out new investors, but such proved futile.
"It is therefore disappointing to be exiting the country; however, our near-term focus and resources must go towards the other more exciting assets within our portfolio," the company’s Chief Executive Jens Pace said in the statement.
The company - founded by Australian businessman Frank Timis - has equity interests in eight remaining licenses in Senegal, Gambia, Ivory Coast and Sierra Leone.
While West Africa's Gulf of Guinea has long been home to the continent's main oil producers - Nigeria, Angola, Gabon and Equatorial Guinea - discoveries in Ghana have pushed companies to expand exploration operations further west.
Look Elsewhere For Economic Survival
In a recent interview with FrontPageAfrica, Liberia’s Commerce Minister, Axel Addy stressed the need for Liberia to focus on improving agriculture and boosting the economy through manufacturing.
Min. Addy: “If we have a diversified economy where all these different commodities were already being produced at a high level, we wouldn’t feel the same pinch we feel now giving iron ore and rubber price has dropped; so we are pushing cocoa.
The other area that is the greatest opportunity is in tourism and fisheries. Fisheries, there is so many ways it can be done. You look at aquaculture, for example fish farming -- we have so many water ways and so many areas where we can do fish farming.”
Min. Addy’s view on the diversifying the economy earlier mentioned by Finance and Development Planning Minister, Boima Kamara, who admitted that the economy was heavily relying on the extractive sector which was failing the economy.
He said government was now investing in agriculture as a sustainable alternative for strengthening the economy.