Aug 16, 2011, 3:23 PM
Minister Demba Jawo has said that Africa Petroleum’s license for petroleum
exploration in The Gambia has expired since September 2016 and the government
has not renewed it.
Speaking to Bloomberg News last afternoon, Mr Jawo said the oil and gas company’s license has not been renewed which means that it has no contract with The Gambia government.
“Renewal or otherwise of their license will depend on the energy needs of the country. But the government has not made any decision about renewing it for now,” he explained.
Shares in the Oslo-listed African Petroleum dropped some 40 per cent on Wednesday; their second daily fall in a row. The slop of the shares followed the confirmation by the petroleum minister, Fafa Sanyang, that The Gambia had ended talks to extend the company’s exploration rights for two offshore areas.
African Petroleum said, in a statement, that it was “surprised and disappointed” by comments from the Gambian official, reiterating its position that it still holds the rights to the licenses and vowing to defend them, The New York Times reported.
Industry attracting huge interests
The Gambia government officials have said there is “huge interest from very credible companies” in the country’s petroleum prospects, attributing this to the recent change of government that the country witnessed.
Mod K. Ceesay, permanent secretary at the Ministry of Petroleum, was quoted by Reuters early this week saying The Gambia has plans to join the Extractive Industries Transparency Initiative which aims to promote open and accountable management of resources.
Early this week, the government announced the expiration of African Petroleum’s license and the decision not to renew it as the company “failed a number of times” in meeting its commitments.
“They asked for an extension and we declined,” Mr Cessay said, adding that under the Gambian laws, the government has the right to award contracts via tender and direct talks.
The Minister of Petroleum, Fafa Sanynag, also confirmed this, saying the decision not to renew the contract has been communicated to the petroleum company.
“We indicated our position to them. There are no ongoing negotiations between us and African Petroleum,” he affirmed.