Licensing Bid Rounds and Negotiation Committee Inaugurated

The Minister for Energy, Hon. Boakye Agyarko has inaugurated the Licensing Bid Rounds and Negotiation (LBRN) Committee to supervise the open competitive bidding of Ghana’s oil blocs to prospective oil exploration companies.

The LBRN committee will assess investors seeking to start oil exploration and production in Ghana, and advise the minister before an agreement is entered.

By this, the ministry is moving away from the practice where oil blocs are awarded to companies without open market bidding.

Speaking to journalists, Mr. Agyarko explained that the committee will make recommendations to the government, upon which a decision will be taken.

According him, “The terms of reference for the committee are: to prepare all the necessary documentation for a successful bid round. Assess and package all the data on the acreages. Set up an online data room where all the data can be accessed by prospective bidders, and embark on promotions and roadshows in collaboration with the Petroleum Commission”.

He added that the committee will also invite bids from prospective applicants and examine them to make sure they meet the requirement in the Petroleum Law. “The committee will also carry out pre-qualification of applicants in line with applicable regulations. Evaluate qualified bids and select winners in line with transparent criteria” he added.

Mr. Agyarko pointed out that the committee will finally “negotiate with the winners of the bids and provide recommendations to the minister for signing the petroleum agreement”.

Giving the rationale behind the move, the minister explained that government intends to enhance transparency and accountability in the petroleum industry.

According to Mr Agyarko, with regards to the nine (9) oil blocks mapped out in the Western Basin, six (6) will be allocated as follows:

1. Three (3) of the blocks shall be allocated through open public competitive tender,

2. Two (2) shall be allocated through direct negotiations,

3. One (1) shall be reserved for GNPC to explore in partnership with its chosen strategic partner with the view to developing its technical capacity and becoming an Operator.

The remaining three (3) that will not be allocated this year but would rather form the basis of Ghana’s second bidding round in 2019.

He indicated that the move is part of H.E President Nana Addo’s government plans to protect Ghana’s interest in oil exploration.