Somalia - Petroleum Exploration Promotion Project

Doctument of The World Bank ]FOR OFFICIAL USE ONLY Report No. 9 7 28 Io I N,~~~~~~~~ lit 1 , t\ t 1 o 8 / I; ,I 1t , 1 , ![ PROJECT PERFORMANCE AUDIT REPORT SOMALIA PETROLEUM EXPLORATION PROMOTION PROJECT (CREDIT 1043-SO) JUNE 28, 1991 Operations Evaluation Department This document has a tLAtricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  COUNTRY EXCHANGE RATES Somalian Shillings (Sh)/US$ Appraisal Estimate (1980) Shl.00 6.295 US$ Actual: Average 1981 6.295 Average 1982 15.79 Average 1983 15.79 Average 1984 = 20.02 Average 1985 39.49 Average 1986 = 72.00 Average 1987 105.18 GLOSSARY OF ACRONYMS AND ABBREVIATIONS b/d - Barrels per Day DMH - D)epartment of Mines and Hydrocarbons (of MMWR) , Government - Government of the Democratic Republic of Somalia MMWR - Ministry of Mines and Water Resources MF - Ministry of Finance PPP - Project Preparation Facility PU - Petroleum Unit  FOR OFFCIAL USE ONLY THE WORLD BANK Washington, D.C. 20433 U.S.A. Ofice oi Diet4*.C. l Opstations Eva&atmin June 28, 1991 MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT SUBJECT: Project Performance Audit Report on Somalia - Petroleum Exploration Promotion Project (Credit 1043-SO) Attached, for information, is a copy of a report entitled "Project Performance Audit Report on Somalia - Petroleum Exploration Promotion Project (Credit 1043-SO)" prepared by the Operations Evaluation Department. 2 Attachment This document has a restricted distribution and may be used by recipients only in the performance of their official ties. Its contents may not otherwise be disclosed without World Bank authorization.  FOR OFFICIAL USE ONLY PROJECT PERFORMANCE AUDIT REPORT DEMOCRATIC REPUBLIC OF SOMALIA PETROLEUM EXPLORATION PROMOTION PROJECT (CREDIT 1043-SO) TABLE OF CONTENTS Page No. Preface ...................... ....... 0 ....... ........ .0....... ...... i Basic Data Sheet ................ 0......................................... liii Evaluation Summary ... ............... . ........ ........ .......... . vii 1. BACKGROUND ................ l II. THE PROJECT ............................................... 2 A. Project Objectives, Description and Processing ........ 2 B. Project Implementation . ............ .. . . ........ . 3 C. Financing Plan .......... ......... ........ .. ............ 4 D. Disbursements . .................. ....... . . ................... 5 E. Performance of Consultants ............. e. ............. 6 F. Maturity. Grace Period and Exchange Risk .............. 7 G. Audit and Petroleum Accounting ........... ........... 7 H. Institutional Development 8........ ........ O.. 8 III. CONCLUSIONS AND LESSONS ..... ............... . ....... ...... 8 IThis document has a rest,icted distribution and may be used by recipients only in the perfotmance Iof theif official duties. Its contents may not otherwise be disclosed without World Bank authorization.  i PROJECT PERFORMANCE AUDIT REPORT DEMOCRATIC REPUBLIC OF SOMALIA PETROLEUM EXPLORATION PROM1OTION PROJECT (CREDIT 1043-SO) PREFACE 1. This is a Project Performance Audit Report (PPAR) on the Petroleum Exploration Project, involving a IDA credit in the amount of US$6.0 million to the Democratic Republic of Somalia to promote crude oil exploration investments by foreign companies. The credit was approved on June 10, 1980. The credit was entirely used after the closing C te was postponed twice by one year. 2. The PPAR is based on the Project Completion Report (PCR) prepared by the Africa regional department and issued on December 8, 1988, Report No. 7533, the President's Report, the loan documents, and on a study of the project files. An OED mission visited Somalia in June 1990 and discussed the effectiveness of Bank's assistance with the Department of Mines and Hydrocarbons. The kind cooperation and valuable assistance provided by the Ministry of Mines and Water Resources (MMWR) in the preparation of this report is gratefully acknowledged. 3. The PCR provided a comprehensive account of the project experience, and discussed the performance of the Bank and the project executing agency. The PPAR elaborates on selected aspects of project implementation, in particular the institutional building aspects of the project, and the performance of the Bank. 4. Due to the prevailing circumstances in the country and on the advice of the relevant country department, no comments were requested.  iii PROJECT PERFORMANCE AUDIT RJPORT DEMOCRATIC REPUBLIC OF SOMALIA PETROLEUM EXPLORATION PROMOTION PROJECT (CREDIT 1043-SO) BASIC DATA SHEET KEY PROJECT DATA Appraisal Actual Actual as I ExDectation Estimate of Apyr.Est. Total Project Cost (US$ million) 8.1 6.4 79 Loan Amount (US$ million) 6.6 4.9 74 Date Physical Components Completed 06/86 12/86 Ecoz,omic Rate of Return (Z) n.a. n.a. CUMULATIVE ESTIMATED Ai