See below for a statement from the Ministry of Natural Resources on the new round of auction for Guyana’s offshore oil blocks:
The Government of Guyana (GoG) is preparing to launch its first bidding round for offshore exploration and production of hydrocarbon blocks. Cabinet is finalising the new fiscal terms and conditions which will allow for the country to gain the maximum economic benefits as we advance the exploration and development of the Guyana offshore blocks.
The 2022 bidding round, which is expected to be officially launched soon, and will be opened for several months which will give interested companies sufficient time to prepare their competitive packages and bid to win the available acreages offshore; which will be done in an open and transparent manner.
Since the discovery of Liza in 2015 the Guyana offshore basin has seen unprecedented development, with Guyana setting a new paradigm for expeditious development of oil and gas resources. According to S&P Global, “the four- and-a-half-year time frame from discovery to first production places Guyana first among global deepwater jurisdictions in terms of the average time to bring major discoveries on stream.”
With the upcoming bidding round the Government of Guyana expects to chart a new path as the Guyana offshore areas emerge as a potential super basin with over 11 billion boe (barrels of oil equivalent) discovered to date and with substantial exploration activities ongoing this figure is expected to increase significantly.
To this end, Cabinet is concluding a definitive terms of reference for the competitive licensing round which will foster a conducive investment environment while maximizing value for the people of Guyana. In this process the government seeks to:
- Obtain a fair share: Ensure the country gets a fairer share of revenues from oil and gas resources through improved fiscal arrangements to benefit the people of Guyana.
- Manage risk: Safeguard the safety of people and the environment by following international best practices in offshore oil and gas development.
- Remain competitive: Maintain a competitive position in the region and globally as key to continued success.
- Encourage investor confidence: Assure investors of stability, predictability, and security on investment.
- Maintain the pace of development: Continue with efficient and sustainable development of oil and gas resources whilst balancing the nation’s developmental agenda with its climate change goals.
Guyana stands out as the most successful of the frontiers now having moved into early-stage production, and it is among the countries that have the best prospects of succeeding, given the current pace of development. Major oil and gas deepwater expertise has been key to unlocking the offshore basin’s potential and enabling the development of discovered resources.
Given that Guyana has adopted an open-door policy for acreage allocation, which, coupled with reasonably attractive fiscal and contractual terms has proven successful. This has allowed our oil and gas sector to set a new paradigm for accelerated deepwater development.
The Government of Guyana will be embarking on an intensive promoting campaign with all necessary technical data and requirements which will ensure that the competitive bidding round is successful for the future development of the offshore exploration and production of hydrocarbons for Guyana’s economy. Further, this process will be done in keeping with international best practices for transparency and accountability for competitive oil and gas bidding processes.
