It can be recalled that on the 30th April 2019, The Gambia Government entered into a Petroleum Exploration Development and Production License Agreement with BP. Per this agreement, BP was obliged to drill the A1 block effective the 30th day of July 2019. This was for an initial exploration period of 2 years, ending 29th July 2021.
BP’s obligations during this period included the acquisition and reprocessing of 2D and 3D seismic data, conducting an Environmental Impact Assessment and drilling one exploration well. The latter is the only outstanding obligation to date. Early 2020, the Covid-19 pandemic struck, causing a drastic change in the Global Oil and Gas industry and leading BP to suspend plans to drill as earlier planned i.e. by the end of 2020.
However, in July 2020, BP informed the Ministry of Petroleum and Energy that it would not be able to drill a well in the A1 Block due to a change in its corporate strategy towards low carbon energy. In accordance with the License terms, if there are unfulfilled obligations, BP will be obligated to pay to Government the difference between the agreed work commitment and the performed work commitment.
Consequently, BP undertook the outstanding amounts of 1,5 billion dalasis as well as the balances of Training, Resources and Rentals due to The Gambia Government. Therefore, BP has fulfilled all its License obligations and the A1 Block will revert to government free of all encumbrances. With BP’s exit, the A1 Block will now be on the market for licensing.
The Gambia Government wishes to thank BP for their collaboration in amicably settling the matter and hopes to work with them in the future. The Government also expresses thanks to the staff of the Petroleum Ministry, Commission and GNPC, the Ministries of Justice and Finance as well as our international partners particularly, the African Legal Support Facility and the Consortium of Consultants (Addleshaw Goddard, DLA Pipers, Open Oil and Ric Weighman) for their support.
Ebrima G. Sankareh
The Gambia Government Spokesperson