Framework’ was completed in April 2008. Per the WB requirements for consultancy selection, the Palau Oil and Gas Task Force (OGTF) created a sub-committee to review and short-list candidates from the seven companies that expressed interest in the consultancy.
The sub-committee reviewed and short-listed five candidates, which was then submitted to the WB for approval. On June 4, 2008, the WB approved the short-list of companies, Houston International Business Corporation, Gaffney Cline & Associates Inc., Denton Wilde Sapte LLP, Eversheds – Frere Cholmeley, and Petroleum Development Consultants Ltd. “I am anxious to see this phase of the project completed soon so we can get back to addressing the policy portion of the oil exploration in Kayangel and Palau in the pending House Bill 7-16-1 within the legislative process,” said Delegate Noah Idechong, Co-Chair of the OGTF. Senator Santy Asanuma, Co-Chair of the OGTF added, “I am pleased that we can now move to the final step in selecting a consultancy firm to develop a proposed petroleum regulatory framework for Palau. I expect that the consultants will be on-island within the next couple of months to start this two-month process. The outcome will then aid us in developing an international-standard legal framework for Palau thereby facilitating the moving forward of House Bill 7-16-1.” The final step, the Request for Proposal, including the terms of reference, and project scope was sent to all of the five short-listed consultants on June 19, 2008. The deadline for consultants to submit their responses is July 25, 2008. Palau’s internal review and selection process will take nine-weeks, September 26, 2008, from the consultant submission deadline. “We have allotted a nine-week deadline as this is the most intensive aspect of the final selection. This step includes obtaining the WB approval of the technical report that will be developed by the OGTF based on the submissions of the five candidates. Then we must prepare the final award, obtain the Minister of Finance’s clearance of the award as he is the WB country point of contact, invite the company for negotiation, negotiate the contract, and obtain the WB clearance of the negotiated contract,” said Youlsau Bells, OGTF Secretariat. Once the contract with the potential consultant is negotiated and endorsed by both the ROP and the WB, the commencement of the consultancy is expected to be September 26, 2008 with a two-month completion date. In addition to the above process, the OGTF has requested technical assistance from the WB to deal with the revenue assignment and derivation rules, focusing on state and national streams. This process must be accomplished prior to the commencement of the ‘Palau Oil and Gas Technical Assistance Project: Consulting Services for the Development of the Petroleum Sector Legal and Regulatory Framework’ consultancy. “The OGTF will be scheduling a series of meetings with the various stakeholders, at both State and national level, within the next few weeks to address the revenue assignment and derivation issues.” Senator Asanuma added that, “This issue is a potential source of conflict among Palauans if not resolved before we commence actual drilling for oil. It is a critical policy component in the hydrocarbon industry and is required by the World Bank to be a part of a good hydrocarbon (oil) legislation for any country,” said Senator Asanuma.
