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Draft oil law demands faster disclosures on discoveries

Aug 09, 2023 News

Kaieteur News – The Petroleum Activities Bill 2023, introduced by the government last week, is set to change how oil companies communicate their discoveries to regulators. The proposed legislation seeks to ensure companies report their findings promptly, preventing long waiting times before informing the public.

According to the draft, should exploration activities lead to a discovery, the involved company must swiftly notify the Minister in writing. They are then mandated to provide details about the discovery and outline the steps they will take to gauge the quality and quantity of the find within a specific timeframe.

After presenting test results, the company will have a 30-day window to declare if the discovery holds commercial value. If deemed commercially viable, the company has six months to submit an evaluation plan to the minister. This will delve into the viability of establishing an oil production industry in the discovered area.

The draft further empowers the Minister to direct the company to undertake any additional investigations deemed necessary. If a company decides that the discovery is not commercially viable, the Minister can, within a year, instruct that the licence be terminated.

While the foregoing provisions are deemed commendable in their attempt to prevent inordinate delays, it does not state what mechanisms would be in place to ensure compliance. Vice President, Dr. Bharrat Jagdeo has admitted on several occasions that the country is still lacking the relevant capabilities, both human and technological, to ensure rigid monitoring. Stakeholders have therefore expressed concern about how these praiseworthy aspects of the Petroleum Activities Bill would be implemented.

Today, lawmakers will review and discuss the Bill’s provisions. If approved, the Bill will mark the completion of one of the last steps before the closure of bids in the country’s first auction in September. This event will feature 11 shallow and three deepwater blocks.

Additionally, this legislation will align with two revised oil contracts the government is finalizing, setting clear terms for both shallow and deepwater operations.

 

 

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