Updated petroleum bill to be made public soon

Mar 06, 2023 News

– Attorney General

Kaieteur News – The new petroleum production bill to update and modernize Guyana’s existing legislation will be made public shortly. This is according to Attorney General and Minister of Legal Affairs Anil Nandlall S.C. who made this known during last Tuesday’s edition of his weekly show, Issues in the News.

Guyana has a Petroleum Exploration and Production Act which was enacted in the 1980s.

Attorney General and Minister of Legal Affairs Anil Nandlall S.C

Nandlall explained that the Petroleum Act was enacted when the country was not a petroleum producer and since Guyana has moved successfully into that sector, the current piece of legislation has become outmoded and cannot be a proper regulatory framework for the current sector.

“We have recognised that a long time ago, and we are working on a brand-new bill that will take into account and will address the modern realities of Guyana as an oil and gas producer. So, that is in the pipeline and that will be made public shortly,” he said.

Additionally, Nandlall related that there are some other related legislations that the government is working on as it relates to the oil and gas sector.

“We have acquired under our belt, two years of experience as an oil and gas producer, operator, and exporter and I believe now we are at a particular vantage point where we can now review our experience and start to work on modernizing and making adjustments to the local content law,” the Attorney-General said.

Nandlall noted that Guyana has now had the Local Content Act enacted for some two years and said that as more experience is gained, it will be subject to reviews.

The Attorney-General committed to the continual review of the legislation and ensuring that lessons learned in the sector are taken on board so that they could play a role in the updating and modernizing of the legislation.

In addition to Nandlall’s disclosure in the petroleum legislation, a recently published Ministry of Natural Resources brief, the Petroleum (Production) Act Petroleum (Exploration and Production, E&P) Act was listed among four legislations that were identified for review and enhancement.

It was stated that the Government seeks to modernize its legal and regulatory framework as it relates to the petroleum sector, to address issues such as oil revenue management, licensing, Production Sharing Agreement models, local content, and Health, Safety, Environmental, and Security (HSES) management.

According to the ministry’s brief, the result would be maximizing the economic benefits to the country, improving management of the technical, environmental, social, and financial risks linked to the sector and building the capacity to engage effectively with investors.

The other legislations to be reviewed and enhanced include the Guyana Geology and Mines Commission Act, the Mining Act, and the Environmental Protection Act Occupational Safety and Health Act. Also mentioned were the Upstream Legal Requirements for Petroleum and a Model Production Sharing Agreement.

Former Finance Minister, Winston Jordan last year warned that “Accelerated production in the absence of modernized laws and the strengthening of institutions is what I would consider a fatal flaw in the management of the sector. I see why they want more oil production because of high prices and to monetize the resource quickly…”

In December 2020, the Inter-American Development Bank (IDB) released a brief pointing out the glaring loopholes in Guyana’s legislative framework which essentially weakens the shield of protection that is needed for the oil sector. According to the Bank, Guyana’s Petroleum Exploration and Production Act and the Petroleum Commission Bill, in their current state, do not contain any clauses that guarantee the independence of any regulator that is appointed for the sector nor do they ensure adherence to industry norms.