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Draft oil law gives Minister Authority to override or revoke powers vested in Petroleum Commission
Kaieteur News – The Petroleum Activities Bill 2023, laid before the National Assembly on August 3, 2023 promises to bring sweeping changes to Guyana’s oil and gas industry, thereby bolstering the transparency and accountability of the sector. It is anticipated that this groundbreaking draft legislation will replace the existing Petroleum (Exploration and Production) Act Cap. 65:04 and the Petroleum (Production) Act Cap 65:05, heralding a new era of management for the country’s petroleum activities.
Natural Resources Minister, Vickram Bharrat
Under this Bill, the Minister of Natural Resources will be endowed with significant responsibilities and powers, which, intriguingly, can be delegated to a public officer or a state agency. This aspect of the Bill underscores the recognition of the need for collaboration and the effective allocation of duties to manage the complexities of the industry. Be that as it may, the draft law notes that the minister’s delegation of powers is not irreversible. In addition to having the power to still perform the functions he grants to another; he can also deviate from or alter their decisions made. The minister, according to the draft law, can also revoke the powers he gives to an agency or officer, thus further reinforcing the minister’s control over the sector.
Beyond delegation, the Bill bestows the minister with the authority to oversee various aspects of petroleum operations. These responsibilities encompass licensing of petroleum exploration, development, production, transportation, and storage operations – extending even to the geological storage of carbon dioxide. The minister will also have the power to enact subsidiary legislation and issue necessary guidelines for effectively realizing the purpose of the Act, demonstrating the progressive and comprehensive nature of this legislation.
Furthermore, the minister will play a crucial role in ensuring adherence to environmental and safety regulations by coordinating and cooperating with relevant state agencies. Through active monitoring of petroleum operations, the Minister can ensure compliance with the Act, the terms and conditions of any license or permit granted, and any petroleum agreement made under the Act and other applicable laws. In cases of non-compliance, the minister will have the authority to direct corrective actions and impose appropriate sanctions, further emphasizing the accountability that the Bill hopes to promote.
Other empowering provisions propose that the minister can prescribe qualification criteria for the granting of a license, direct licensees or holders of a permit on matters regarding regulations under the Act ensure the recovery of all revenues due to the State, and commission necessary studies or investigations.
It is significant to note that the Petroleum Activities Bill 2023 sets a significant precedent for the burgeoning oil industry in Guyana. Vice President, Dr. Bharrat Jagdeo previously noted that the Stabroek Block, now brimming with an estimated 11 billion barrels of oil resources and operated by an ExxonMobil-led consortium, will undoubtedly benefit from this robust legislation.
Further, this new law comes at a critical time as Guyana prepares for its maiden oil blocks auction in September 2023. The law serves as a fundamental prerequisite, setting a transparent and rigorous legal framework for potential bidders.
Through the dynamic powers vested in the Minister of Natural Resources, the law ensures a fair and regulated bidding process. The Bill also represents a transformative moment in Guyana’s oil sector history, setting a high bar for transparency, accountability, and responsible management.
- laid before the National Assembly on August 3, Natural Resources Minister, The Petroleum Activities Bill 2023, Vickram Bharrat
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