Once re-elected to office in September 2025, the People’s Progressive Party Civic (PPP/C) government is looking to conduct its second auction for oil blocks offshore Guyana in 2026.
This is according to General Secretary of the party and Vice President Dr. Bharrat Jagdeo, who noted that the State will be in a better position to auction the blocks which were not successful in the last round of auction and those that were relinquished.
“We want to go this time with three pieces of information that would not have been available to those who are bidding in the first round,” he said, explaining that those three documents include the new model Production Sharing Agreement (PSA), the updated petroleum law and 3D seismic studies.
The new PSA provides more benefits to Guyana.
These include the increase of the royalty from a mere two per cent to now a 10 per cent fixed rate; the imposition of a 10 per cent corporate tax, and the lowering of the cost recovery ceiling to 65 per cent from the previous 75 per cent, while maintaining the retention of the 50-50 profit-sharing after cost recovery.
Further, there is provision for a signing bonus of upto $20M for exploration licences.
“With these three pieces of information in the next auction, we believe that we’ll get good bids,” Dr. Jagdeo said.
In its first auction, Guyana received bids for eight of 14 offshore oil and gas exploration blocks offered. Eventually, four companies accepted the new PSA. Asked for an update in June, Jagdeo said no prospecting licences will be signed for those oil blocks before the September polls.
Meanwhile, the government had also announced a policy of working with bilateral donors.
The Vice President on Thursday said, “We believe that we want to continue to do so, but it must yield good results for our country because we may be able to cement good deals with people who have experience in this matter [such as] Qatar or Kuwait.”
Further, the Government will be working to market the gas which is currently being reinjected into the wells offshore in the process of oil production, and improve monitoring of companies working in the sector.
“We now have to step up our monitoring and evaluation of these entities that are producing offshore,” he noted.
Guyana found oil in 2015 and commenced oil production in 2019. To date, there have been over 30 successful discoveries with production currently reaching approximately 665,000 barrels per day.
It is expected that by the end of 2027, the country’s production capacity can increase up to approximately 1.3 million barrels per day.
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