The government of Guyana has opened a new round of auctions for fourteen oil blocks in Guyana’s lucrative offshore oil and gas fields.
President Dr Mohammed Irfaan Ali announced the auction’s start this morning, saying his government expects to complete the bidding process by April 14, 2023, and have contracts signed by the end of May 2023.
Ali stated that the new bid round and subsequent contracts take into account all of the lessons learned from the Stabroek block contract controversies.
“What we’re aiming for is the best possible outcome for Guyana, given the lessons we’ve learned,” Ali explained.
The 14 blocks are spread across deep and shallow water. Given the differences in exploration and production at each depth, each category will have its own set of requirements that must be met in order to be successful.
A minimum signature bonus of US$10 million will be required for shallow water blocks and US$20 million for deepwater blocks.
There is also a US$20,000 participation fee to gain access to the virtual data room.
The minimum work commitments specified for the prospecting licence’s initial and renewal periods consist of a combination of seismic and exploration well drilling, with prior commitment fulfilment required before entering subsequent renewal periods.
Guyana, according to Ali, is looking for companies that can develop the oil and gas blocks “quickly.”
“We are in a situation where there is a timetable for oil and gas development.” We understand the direction in which the world is heading, so it is critical for us to have developers who are serious about developing oil and gas resources in a timely manner, so strong contractual commitments are in place during this bidding round with strong relinquishment obligations,” the president stated.
Ali stated that Guyana is aware of the current financial market constraints in terms of funding large projects such as oil developments, and that the contracts seek to strike a balance that is beneficial to both Guyana and investors.
In an attempt to entice investors, Ali emphasised that Guyana’s offshore blocks are among the fastest growing, with resources estimated to be more than 25 billion barrels of oil equivalent (boe) and an estimated reserve in excess of 11 billion boe.
