Government doing internal surveys not seismic work for offshore blocks - VP Jagdeo clarifies

Government doing internal surveys not seismic work for offshore blocks – VP Jagdeo clarifies

Jan 20, 2024 ExxonMobil, News, Oil & Gas

Vice President, Dr. Bharrat Jagdeo

Kaieteur News – While Senior Finance Minister, Dr. Ashni Singh announced on Monday during his 2024 budget presentation that the government will be undertaking key survey studies on offshore oil blocks, it is not to be confused with seismic work. This clarification was offered on Thursday by Vice President, Dr. Bharrat Jagdeo during a press briefing.

“We have no immediate plan to do seismic work funded by the Government of Guyana,” the official said.

The chief policymaker asserted that this survey simply entails an internal assessment of all the available data on Guyana’s offshore oil and gas concessions so that authorities may be better able to assess the potential petroleum resources available for development and production. He said this survey will also allow government to put all the information into a unified format.

Further, the Vice President explained that this initiative and its importance became quite evident during the preparation of data for potential bidders participating in Guyana’s first oil blocks auction, launched back in December 2022. Additionally, he said the compilation of the data will include all the information now available since the bid allows for a smoother process for the next auction.

He said too that this streamlining will also take into account data pertaining to the 20 percent portion of the ExxonMobil-operated Stabroek Block, due to be returned to the State in October.

Further, the Vice President said the relinquished portion could form part of Guyana’s next auction, noting that government has to consult with its advisors on the right timing for hosting same.

“We’re going to talk to our advisors to see what’s happening in the world of auctions and what’s the right timing because they’re more attuned to what’s happening globally. We have to fit any option that we may pursue in that context,” the official said.

For the time being, he said government is focused on concluding the first auction which was launched in December 2022.

Government had announced that a consortium led by four African-Guyanese women, represented by Sispro Inc., secured two blocks: the shallow water block S3 and the deep-water block D2.

Total Energies EP Guyana B.V., in partnership with Qatar Energy International E&P LLC and Petronas E&P Overseas SDN BHD, won the shallow water block S4.

ExxonMobil Guyana Limited, Hess New Ventures Exploration Limited, and CNOOC Petroleum Guyana Limited were awarded the shallow water block S8.

International Group Investment Inc from Nigeria was selected for two shallow water concessions, S5 and S10.

Liberty Petroleum Corporation and Cybele Energy Limited, an American and Ghanaian partnership, secured the shallow water block S7.

Lastly, Delcorp Incorporated, in collaboration with Watad Energy and Communications Ltd and Arabian Drilling Company, obtained rights to the deep-water block D1.

These companies are now undergoing a due diligence process, as part of Guyana’s rigorous oversight of the oil sector.

Once their agreements are signed, the companies will be expected to pay a 10 percent royalty and a 10 percent Corporate Tax. Their contracts will also stipulate that cost recovery be capped at 65 percent in a given year, while profits will be shared 50/50 between the parties. For shallow water blocks, companies have to pay a minimum signing bonus of US$10 million while a minimum of US$20 million is set for deep water concessions.

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Dr. Ashni Singh, Dr. Bharrat Jagdeo, offshore, Senior Finance Minister, Vice President

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