Oil blocks should be saved for future – GCCI

A leading private sector organisation is recommending that the Government save the remaining oil blocks for the future and, in other cases, repossess and reissue blocks which have already been allocated.

President of the Georgetown Chamber of Commerce and Industry (GCCI), Deodat Indar told a gathering of private sector officials at an oil and gas summit on Tuesday that the Government should be careful not to issue out all of the petroleum blocks.

“We need to consider Guyana having one or two blocks of its own as they did in Norway with STATOIL in the early days when they found the oil,” Indar suggested.

He also recommended that the oil blocks be saved for the future under the concept of intergenerational equity.

“We should not issue them all and deplete our resources in one lifetime, we need to leave some for future generations,” he stated.

The GCCI President further suggested that Government consider activating the relinquishment clause in the production sharing agreements in order to repossess blocks that have been allocated but not being used.

“If you enforce them or you strengthen them and the operators are only holding up the areas and they are not actively exploring them, then there must have some level of relinquishment and we issue those to new aspirants,” he explained.

There is now high demand for the petroleum blocks offshore Guyana following the world-class discoveries made by US oil giant ExxonMobil over the last few years.

The Guyana Government said it will be hiring an international firm to advise on how to market the remaining unassigned oil blocks.

There have been calls for the blocks to be auctioned off in order to ensure a competitive and transparent process in the allocation of the blocks.

A map from the Guyana Geology and Mines Commission shows that there are not many areas remaining.

The companies that have blocks in the deepwater area, offshore Guyana, are: Repsol and Tullow Oil (the Kanuku Block); Tullow (the Orinduik Block); Anadarko (the Roraima Block); Ratio Oil (the Kaieteur Block); Esso, CNOOC Nexen and Hess (the Stabroek Block); Esso, Mid Atlantic and JHI (the Canje Block; CGX (the Demerara and Corentyne blocks); ON Energy; and Nabi.