‘No cost to the Govt’ as 8 firms submit bids for 3D seismic study offshore

The content originally appeared on: INews Guyana
Vice President Dr Bharrat Jagdeo

A total of eight firms have submitted bids and are being prequalified to conduct a 3D seismic study of oil blocks offshore Guyana.

Vice President Dr Bharrat Jagdeo, at a media engagement on Thursday, said that once the prequalification process is completed, the bidders must submit proposals for the project.

A 3D seismic study is a key tool used in oil and gas exploration to create a three-dimensional image of what lies beneath the Earth’s surface. This makes it easier to pinpoint potential locations of oil and gas reserves.

Last month, the Ministry of Natural Resources extended a request for Expressions of Interest for a “reputable and experienced” firm to conduct 3D Multi-Client Seismic Surveys offshore Guyana.

According to the notice, the object of this assignment is to acquire, process and interpret high-quality 3D seismic data to facilitate the exploration and potential development of hydrocarbon resources offshore Guyana, and to ensure that this data is available for effective evaluation during future bidding and licensing rounds.

At his press conference, Dr Jagdeo pointed out that this was not done for the previous licensing round, which concluded in 2023.

“We went out the last auction without any 3D seismic study, so we didn’t have much data for the areas. When you have less data, people don’t put in great bids, so they don’t know what is there, they can’t interpret the data,” he said.

He added that this study will come at no cost to the government.

“We are hoping that [for] all of the unallocated areas, we may have the 3D seismic studies done by these people. They do it, we don’t have to pay for it because it’s a very costly exercise, and they can share the data with us, and sell it to the clients,” he explained.

As a result, the study will be conducted to ensure that block bidders make more informed decisions.

Last year’s auction concluded with 14 oil blocks on offer within the country’s shallow and deep-water areas.

During the bidding round, eight blocks were shortlisted based on the bidders’ ability to meet the criteria of the expected work programme and the required financial commitments.

Six companies were awarded oil blocks, among them a woman-owned Guyanese company, Sispro Inc., which secured two blocks.

Other blocks were awarded to Total Energies, in collaboration with Qatar Energy International and Petronas, International Group Investment Inc. and Montego Energy, Liberty Petroleum Corporation, Cybele Energy Limited, Stabroek Block partners: ExxonMobil Guyana Limited, Hess New Ventures Exploration Limited, and CNOOC Petroleum Guyana Limited, as well as Delcorp Inc. Guyana, which comprises Watad Energy and Communications Limited and Arabian Drilling Company of Saudi Arabia.

There is already a minimum signature bonus requirement of US$10 million for shallow water and US$20 million for deepwater blocks in the Production Sharing Agreement (PSA).

While open to minor adjustments in the PSA, the government has been adamant that the essential fiscal terms would remain unchanged.

Dr Jagdeo said that negotiations are ongoing, and agreements on the non-fiscal terms of the PSA are coming to a close.

“We said that we had some pushback on the non-fiscal elements…that they were too harsh, and that is what needs to be finalised,” he told reporters. (Extracted and Modified from DPI)