The Department of Energy has put a pause on granting oil blocks offshore until 2020.
The Department’s Head, Dr. Mark Bynoe and Energy Advisor, Mathew Wilks on Thursday disclosed that the process has been halted until the Unit can get its regulations and complementary legislation in order.
“We need to understand the layer of the land, we are speaking about revising the legislative framework and we also believe there are significant players already in deepwater – Tullow Oil, Total, Anadarko, ExxonMobil,” Dr. Bynoe said.
He noted that there are still significant areas to be exploited with a number of interests expressed in Block C located off of the Canje Block.
However, the Department is working on a model contract which it wants to complete before issuing any further exploration licenses.
The model contract will be used for future Petroleum Sharing Agreements (PSA). The Department is also developing a “model toolkit to allow for probabilistic scenario modeling of current and future PSAs,” Dr. Bynoe said.
The Petroleum contract with Esso Exploration and Production Guyana Limited (EEPGL) and other stakeholders have been criticized for various clauses it includes.
Dr. Bynoe said the Government will honour the “sanctity” of the contract since any move to make further changes can affect potential investments.
Mr. Wilks, Energy Advisor with 32 years of experience as a senior oil and gas business developer and negotiator, is helping with the development of the model.
He said, “all that is happening here is this is the right time to evolve the contract.”
However, there must a balance between the benefits to Government and the investor since “you can have the most advantageous contract for the government but that doesn’t mean people will invest.”
The Energy Department is also looking for investors in shallow an onshore exploration.
It is in consultation with a firm as it considers the provision of a package containing information necessary for persons to understand the resource base to foster greater interests in these areas.
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