By: Rusana Philander (South Africa)
The Director General of the Petroleum Directorate in Sierra Leone Foday Mansaray has recently announced at the conclusion of its fifth licensing round at the Africa Energy Week that the country will be commencing with oil and gas drilling next year 2024.
This comes after there has been a high impact drilling success rates and Africa’s upstream sector has also produced a surge in exploration hotspots in southern, eastern and western regions. This is a demonstration that there are still more unexplored areas for gas and oil in Africa.
However, the Petroleum Directorate of Sierra Leone (PDSL) is now set to enter negotiations with three qualified companies that have been selected and which have all prequalified for exploration and production licenses as operators.
Mansaray said that the fifth licensing round has been completed and that negotiations will start in November 2023. “We have attracted people who want to reduce red tape. Investors also like the transparency that our country provides. This is why we invite companies to come and invest in exploration and drilling,” he said.
“Sierra Leone is predominantly an oil rich country and we are excited to start with drilling for oil and gas next year. This is a new dawn and will definitely propel the country,” Mansaray said. .
PDSL aims to finalize the reward of all licenses by the end of this year, signaling an exciting new chapter in Sierra Leone’s energy sector. “We are quite efficient in what we offer and we have streamlined our operations to take 85 business days to completion,” he noted.
PDSL’s exploration history showcases the nation’s potential, with eight wells drilled and four significant discoveries, including the notable Mercury 1 well, Venue B1, Jupiter 1, and Savannah 1X. These discoveries underscore the vast opportunities awaiting investors in Sierra Leone’s petroleum sector.
Annually, the African Energy Week attracts investors from various African countries including political leaders. The president of Mozambique Filipe Nyusi, Gwede Mantashe South Africa’s Minister of Energy and Minerals were all in attendance. The South African Minister of Energy talks about energy in the country saying that they want to turn some of the power stations into gas stations, and retain nuclear power, this is why they wants to extend the nuclear plant at Koeberg for 20 years including the one in Port Elizabeth.
“There has been the discovery of oil on the West coast and Namibia and green hydrogen at Saldanha Bay. But renewable energy takes a lot of transmission space. Then talking about minerals, we cannot just export it raw. Investors must come and invest. The government is working to improve Eskom’s performance”, the Minister said.
While, Hasnayn Ebrahim the managing director of Africa Internal Advisors, said “Twelve months ago we thought that our electricity grid was going to collapse. The rest of the world can learn about how Eskom has turned things around. The big energy units are coming back and this is great.”
However, the license initiative offered 150 reticular blocks, each spanning approximately 1,360Km2. PDSL is opening its doors to potential investors, inviting them to explore the wealth of data available, including 2D seismic data covering 16,000 linear kilometers and 3D seismic data encompassing 11,000Km2 across the entire basin.
Mansaray said PDSL believe in the untapped potential of Sierra Leone’s oil and gas resources. “Our streamlined, efficient process, coupled with our rich geological prospects, makes Sierra Leone the next hotspot in oil and gas production. We invite reputable investors to join us in this exciting journey.”
PDSL’s licensing is not just an opportunity; it is an invitation to engage in a transparent, flexible, and mutually beneficial partnership. The Directorate encourages potential investors to apply as operators and assures them of a supportive environment, including negotiations for paid interest upon discovery. Moreover, PDSL is working on legislation to facilitate onshore operations, demonstrating its commitment to fostering a conducive business environment.
“Investors in Sierra Leone benefit from not only our proven resources and extensive data coverage but also our flexible and competitive regulatory, legal, and fiscal terms,” added Mansaray”, he further that “We want investors to thrive, and we are willing to negotiate in good faith to ensure success for all parties involved.”
Investors are invited to explore the vast potential of the nation’s oil and gas sector. “PDSL stands ready to facilitate partnerships, driving exploration and contributing to the nation’s economic growth,” Mansaray concluded.
