Philadelphia, PA USA –
Oil exploration off Liberia has experienced a major setback with the announcement on Monday by the global oil giant ExxonMobil that it is quitting a block off the small West African nation.
The prospect and investment were seen as a potential economic boon for Liberia and profitable investment for ExxonMobil a year ago, if exploration yielded commercially viable oil.
According to the global gas an oil news source Upstream, “Partner Canadian Overseas Petroleum revealed on Monday that the pair have let go of LB-13 after both companies “elected not to enter into the third exploration phase” at the tract.”
ExxonMobil is taking a loss of $15.6 million in exploration and evaluation expenses and says it intends to inform Liberian authorities over its decision to quit further exploration. The technical team of ExxonMobil, however said, it saw “opportunities in other areas of the block and continued “to perform geological and geophysical analysis in these areas.” This reservoir has potential quality.
According to an article written in 1994 by A. Hallam, An Outline of Phanerozoic Biogeography, “…The Late Cretaceous is often regarded primarily as a time of biotic retractions that culminated in the spectacular mass extinction at the end of the Cretaceous, but it was also a time of major evolutionary radiations in both the marine and terrestrial realms when many modern faunas and floras first became established. This mostly shallow-water, clastic sequence is, in places, very fossiliferous.
First signs of trouble in its oil prospecting was the delay by ExxonMobil in 2014 when it curtailed exploration and drilling of the Mesurado-1well in Liberia due to the Ebola pandemic which heavily impacted the countries in the Mano River basin.
Liberia’s economy which needs a major boost and offshore capital will be further pressured with this major loss of a ExxonMobil’s investment for oil.
According to an economic overview report of Liberia by the World Bank, “…Headline inflation averaged 12.4% in the first half of 2017, compared with 7.3% the previous year, driven by the relatively fast pace of the depreciation of the Liberian dollar against the U.S. dollar (of 20% in the first half of 2017 compared to 11% in the same period in 2016). Other factors include excess liquidity in terms of Liberian dollars, and the relative shortage of inflows of foreign exchange. The resultant rise in the cost of living, especially the cost of food, which is mostly imported, increased fiscal pressures. Limited employment continues to undermine the welfare of Liberians in both urban and rural areas.”
Political transition in Liberia is at an impasse due to a challenge of the October 10th Presidential election.
By Emmanuel Abalo
West African Journal Magazine