Seward Cooper, chairman of NOCAL

(Reuters) – Cash-strapped National Oil Company of Liberia (NOCAL) will slash its work force by over two-thirds as part of measures aimed at cutting costs amid a fall in the price of oil, a statement and a senior official with the state-owned company said on Tuesday.

The country does not produce any oil or natural gas but placed its hopes in potential reserves offshore in deep and ultra-deep waters, following the example of Gulf of Guinea neighbours Ghana and Nigeria, Africa’s biggest producer.

However, Liberia has been hit hard by a rapid decline in world oil prices that has led many companies to reassess their exploration strategies.

A statement released by the company said the chairman of NOCAL’s board of directors, Seward Cooper, had met with staff on Friday to explain the situation.

“He said despite the best efforts of Board and Management to put in place several austerity measures … the continuing crumbling oil prices have severely undermined NOCAL’s capacity to meet its operational and personnel obligations,” it read.

NOCAL would implement a restructuring plan including “personnel and related administrative and operational adjustments” to significantly reduce costs, it said, adding that the process would be handled by an external consultant.

Though the statement did not give details, a senior official at NOCAL told Reuters that the plan would include cutting all but 50 of the company’s current 160 staff positions.

Oil companies have drilled nine exploration wells at a cost of around $1 billion, a Senate committee said in June, but with little to show for their investments many have chosen to transfer their operations to countries with proven reserves.

In a further blow, Liberia has been the country hardest hit by a deadly Ebola outbreak that began last year and has killed over 11,000 people across the region.

Sales of seismic data, which had generated over $200 million in revenues for NOCAL before 2014, had consequently dried up and many of the country’s offshore blocks have been vacated, the Senate committee said.

Tullow Oil, Chevron, Anadarko and African Petroleum had been among companies carrying out exploration in Liberian waters.

Exxon Mobil signed into a block in 2013 but put the project on hold due to the Ebola crisis.