Latest update December 16th, 2024 9:00 AM
GRA, GNBS to play lead roles in process for Guyana’s oil sale
By Kiana Wilburg
The Guyana Revenue Authority (GRA) and the Guyana National Bureau of Standards (GNBS) will have key roles to play when it comes to overseeing the measurement process for Guyana’s share of the crude from the oil-rich Stabroek Block.
Energy Dept. Head, Dr. Mark Bynoe
Speaking to members of the media at a press conference, yesterday, on this front, Energy Department Head, Dr. Mark Bynoe assured that this is one of the steps being taken to ensure the process for the measurement of Guyana’s oil is in place.
The Energy Department Head said, “You would recognize that GNBS has the mandate in terms of measurements and ensuring that the said equipment is calibrated. We have been working with them on ensuring that their capacities are being built. It may be necessary going forward that some amount of third party assistance is provided.”
With respect to GRA, Dr. Bynoe noted that this agency would be responsible for taking care of all customs-related matters. Its immigration department would also be required to ensure anyone coming into Guyana’s waters is in compliance with the laws.
This newspaper asked the Energy Department Head if a decision has been taken on whether Guyana will have a daily or weekly presence on the rig to oversee the process of measuring the oil. To this, Dr. Bynoe said, “We are projecting to do crude lifting every eight to 10 days. A lift can take about 36 hours so we may have to consider if we need to have continuous presence or if it would be necessary for you to be there just for the lift. These are discussion points which the government is now looking at.”
Further to this, Dr. Bynoe said that Guyana’s portion of the crude would be sold via Free on Board (FOB). He said this simply means that the crude is sold to the buyer at the exit point of the FPSO and the buyer is responsible for shipping the said crude which will be sold in million barrel cargoes.
The official said, “…I am happy to report that the department has been working with its sister agencies and the operator to ensure that that process is in place and running as efficiently as possible from day one.”
Dr. Bynoe also noted that a tender will be issued in the third or fourth quarter for a consultant with the relevant experience to market Guyana’s share of the crude.
In addition, Dr. Bynoe noted that the crude lifting agreement will soon be finalized. He said that the Association of International Petroleum Negotiators’ Model Crude Oil Lifting Agreement is being used to support same.
He noted that the document is used throughout the industry and it sets up a mechanism for allocating the schedule of crude cargo lifting based on volume entitlements which are calculated, taking into account, the cost recovery rules of the petroleum agreement. It also lays out the strict procedures for crude lifting too.
Dr. Bynoe said, “The department continues to be aware of the risk associated with not getting this right.”
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