Liberia Petroleum Regulatory Authority (LPRA) Strategic Assessment of the Potential Environmental, Economic and Social Impacts from Petroleum Operations in the Harper Basins May 2019 Table of Contents 1.0 Introduction ............................................................................................................................................. 5 2.0 Reasons for Bid Rounds ........................................................................................................................... 5 3.0 Description Tentative Schedule of Petroleum Activities ......................................................................... 7 4.0 PRELIMINARY ECONOMIC ASSESSMENT ................................................................................................. 7 4.1 Overview .............................................................................................................................................. 7 4.2 Demand for Oil and Gas ..................................................................................................................... 10 4.3 Fiscal Regime ..................................................................................................................................... 10 4.4 Fiscal Instruments .............................................................................................................................. 11 4.5 Windfall Profits Taxes ........................................................................................................................ 12 4.6 Bonuses .............................................................................................................................................. 12 4.7 Royalties ............................................................................................................................................. 12 4.8 Surface Rental or land/acreage rental fees ....................................................................................... 12 Production Sharing .................................................................................................................................. 13 4.10 Ring-Fencing..................................................................................................................................... 13 4.11 Loss Carry-forwards ......................................................................................................................... 13 5.0 Bid Round ............................................................................................................................................... 13 5.1 Historical Perspectives on Bid Rounds............................................................................................... 14 5.2 Joint Venture...................................................................................................................................... 15 6.0 Economic Evaluation ............................................................................................................................. 15 6.1 Assumptions....................................................................................................................................... 15 6.2 Results ................................................................................................................................................ 15 6.3 Sensitivity Analysis ............................................................................................................................. 16 6.4 Selling of Share (Privatization) ........................................................................................................... 18 7.0 PRELIMINARY ENVIRONMENTAL ASSESSMENT ..................................................................................... 18 7.1 Affected Environment ........................................................................................................................ 18 7.2 Potential Impacts and Alternatives ................................................................................................... 19 7.3 Methodology...................................................................................................................................... 20 7.4 The ESIA Process ................................................................................................................................ 20 7.4.1 Introduction to the Process ........................................................................................................ 20 7.5 Mitigation and Monitoring Required ................................................................................................. 21 7.6 Regulatory Review ............................................................................................................................. 21 1 | P a g e 7.6.1 Legislative Framework ................................................................................................................ 21 7.6.2 Constitution of the Republic of Liberia ....................................................................................... 23 7.6.3 Environment Protection and Management Law of the Republic of Liberia ............................... 23 7.6.4 Effluent Discharge License .......................................................................................................... 24 7.6.5 Solid and Hazardous Waste Disposal License ............................................................................. 24 7.6.6 Pollution Emission License .......................................................................................................... 24 7.6.7 National Environmental Policy ................................................................................................... 24 7.6.8 The Act Creating the Environmental Protection Agency ............................................................ 24 7.6.9 National Energy Policy ................................................................................................................ 25 7.6.10 Statements of Policy ................................................................................................................. 25 7.6.11 New Petroleum Law of Liberia ................................................................................................. 25 7.7 Institutional Framework .................................................................................................................... 27 7.7.1 Environmental Protection Agency .............................................................................................. 27 7.7.2 Liberian Coast Guard .................................................................................................................. 28 7.7.3 Ministry of Mines and Energy ..................................................................................................... 28 7.7.4 Ministry of Public Works ............................................................................................................. 28 7.7.5 Ministry of Health ....................................................................................................................... 29 7.7.6 Ministry of Internal Affairs.......................................................................................................... 29 7.7.7 Ministry of Agriculture ................................................................................................................ 29 7.7.9 National Fishery and Aquaculture Authority ............................................................................. 29 7.8 Environmental and Social Impact Assessment Process ..................................................................... 29 7.9 General Background of Liberia .......................................................................................................... 30 7.9.1 Coastal Plains .............................................................................................................................. 31 7.9.2 Rolling Hills .................................................................................................................................. 31 7.9.3 Plateau and Tablelands ............................................................................................................... 32 7.9.4 Northern Highlands .................................................................................................................... 32 7.9.5 Meteorological Setting ............................................................................................................... 32 7.9.6 Precipitation................................................................................................................................ 32 7.9.7 Temperature and Sunshine ........................................................................................................ 32 7.9.8 Wind ............................................................................................................................................ 33 7.9.9 Relative Humidity........................................................................................................................ 35 7.10 Geological Setting ............................................................................................................................ 36 7.10.1 Stratigraphy .............................................................................................................................. 36 7.10.2 Structure 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