Latest update December 15th, 2025 12:30 AM
Govt. opts for monthly royalty payments in new oil deal
By: Davina Bagot
(Kaieteur News) – The Government of Guyana (GoG) in its revised Production Sharing Agreement (PSA) has opted for royalty to be paid into the Natural Resource Fund (NRF) on a monthly basis.
According to the terms of the new oil deal, signed on November 11, 2025 with Total Energies, Qatar Energy and Petronas, the payment shall be made in cash following the end of each month. The 10% royalty will be payable on all petroleum produced and available for allocation and does not include oil used by the contractor for fuel and transportation.
Minister of Natural Resources, Vickram Bharrat
Article 37.2 of the Shallow water PSA states “…cash payment shall be due monthly, thirty (30) calendar days following the end of each Calendar Month. Upon payment of the royalties, either in kind or in cash, assessment receipts evidencing payment of the Contractor’s royalty shall be furnished by the Minister to the Contractor stating the amount and other particulars customary for such receipts within forty-five (45) calendar days…”
Notably, this provision varies from the 2016 Petroleum Agreement with ExxonMobil and partners. That contract requires the contractor to pay a meagre 2% royalty to the GoG at the end of each calendar quarter or three months.
Further, the lopsided arrangement with Exxon in Article 15.7 also gives the minister powers to remit “in whole or in part” or defer the royalty payment owed to the county. No such favours have been extended to Total Energies in the revised Petroleum Agreement.
The agreement is the first to be signed since government introduced a revised PSA with greater fiscal benefits to the country. Amid the package is 10% royalty, 10% taxes and cost recovery capped at 65% monthly with profits to be split 50/50.
Notably, the GoG secured a US$15M signing bonus as part of the successful negotiations that were held with the consortium. Total Energies has been awarded block S4, located in shallow water, offshore Guyana. The French company leads the consortium with a 40% interest in the block, along with its partners, Qatar Energy and Petronas with 35% and 25% respectively. Block S4 spans an area of approximately 1,788 square kilometres, located 50 to 100 kilometres off Guyana’s coast in water depths ranging between 30 and 100 metres.
The company said it is targeting the latter half of 2026 to commence seismic acquisition.
In the meantime, it was revealed that three other contracts are also being negotiated to be signed for the blocks S5 – International Group Investment Inc.; S7 – Cybele Energy; and S10 – International Group Investment Inc.
These contracts are likely to mirror the terms of the Total deal.
Discover more from Kaieteur News
Subscribe to get the latest posts sent to your email.
Similar Articles
THE BLUNT OF THE DAY
Sports
Features/Columnists
Sir. Ronald Sanders
The GHK Lall Column
Weekend Cartoon
