Equatorial Guinea cancels CHC Helicopters contracts for non-compliance

  • Written by  Bob Koigi

The Ministry of Mines and Hydrocarbons of Equatorial Guinea has mandated all petroleum operators including but not limited to Noble Energy, Exxon Mobil, Kosmos Energy, Trident, Marathon Oil Corporation and other operators to cancel all contracts with Canadian-based CHC Helicopters due to noncompliance of Equatorial Guinea’s national content regulations.

“It is the responsibility of the Ministry of Mines and Hydrocarbons to ensure strict compliance to our country’s National Content Regulation of the Hydrocarbons Law,” said H.E. Gabriel Mbaga Obiang Lima, the Minister of Mines and Hydrocarbons.

“These laws are in place to protect and promote local industry, create jobs for citizens, promote the sustainable development of our country, and we are aggressively monitoring and enforcing the compliance of these requirements.”

Oil companies operating in Equatorial Guinea have been given 60 days to unwind contracts and find new suppliers, with only those companies in compliance with the local content provisions established in 2014 allowed to bid for contracts.

A compliance review of the entire sector is ongoing led by the Director of National Content and outside legal advisors of the Ministry. The notice will be expanded to all service companies who are non-compliant as the review continues. Similar measures will be taken.

Under the National Content Regulation of 2014, all agreements must have local content clauses and provisions for capacity building, with preference given to local companies in the award of service contracts. Local shareholders must be part of every contract as prescribed by law. The operators have an obligation to ensure compliance of their subcontractors.

“We are eager to work with international companies who partner with Equatorial Guinea in the development of our industry,” said the Minister. “But we expect all companies operating in Equatorial Guinea to follow the laws of the Republic of Equatorial Guinea. As Minister, I will not hesitate to enforce the law to ensure compliance”.

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