Guyana President Dr. Mohamed Irfaan Ali has launched Guyana’s competitive bid round for 14 offshore oil blocks, comprised of eleven shallow water blocks and three ultra-deepwater blocks.

Officially open today, December 9^th 2022, the bid round is expected to be open for 4 months and will close on April 14^th 2023.

With the massive potential for “25 billion barrels”, President Ali outlined that evaluations of the proposals will take place and following an expedited negotiation period, awards of blocks are expected in Q2 2023.

Minister of Natural Resources Vickram Bharrat is expected to publish a notice in the Official Gazette in keeping with the Petroleum Act.

Guyana has seen extraordinary success with offshore discoveries in the last 5 years. The country continues to grow and expand the opportunities to increase production and the inflow of investment into the energy industry and other sectors. The largest upstream player to date has been Exxon, who produces more than 340,000 barrels of oil per day from two FPSOs. The company has had significant success in Guyana and indicates that additional FPSOs are already in development for future projects.

The government has made it clear in the past that the industry must be to the benefit of all Guyanese citizens. At the launch of the bid round, President Ali, stated, “We are hoping that there will be maximum participation and that Guyana would be part of a partnership that creates greater benefit and greater wins for our country and our people.”

Improved fiscal terms have been outlined that provide greater balance of the share of revenue between the government and contractor, while maintaining Guyana’s competitive edge in the region globally.

The International Energy Conference and Expo will take place from February 14-17 2023 at the Guyana Marriott Hotel. At the conference there will be keynote addresses by the leadership of the country including: His Excellency Dr. Mohamed Irfaan Ali, President of Guyana, Prime Minister Mark Anthony Phillips, Vice President, Dr. Bharrat Jagdeo and Minister of Natural Resources, Vickram Bharrat.

At the conference we will also hear from senior experts in Guyana’s oil and gas sector, including John Hess, Chief Executive Officer, Hess and Alistair Routledge, President, ExxonMobil Guyana.

Canadian based CGX Energy along with Frontera Energy Corporation have indicated their readiness to spud (begin drilling) the Wei-1 well in the Corentyne block offshore Guyana.

The partners have issued a press release stating their commitment to drill the Wei-1 well and that final preparations are complete in advance of spudding the Wei-1 well.

The well will be spudded no later than January 31, 2023 utilising the NobleCorp Discoverer semi-submersible mobile drilling unit.

The Wei-1 well will be located approximately 14 kilometres northwest of the Kawa-1 exploration well in the Corentyne block, approximately 200 kilometres offshore from Georgetown, Guyana

To go alongside this activity, CGX intends to support the Government’s effort to accommodate increased vessel activity in Guyana. According to a statement from the partners, in-river construction activity has begun for a deepwater port at Berbice.

Work has already begun at the Berbice Deepwater Port (BDWP) on a 50 x 12 metre access trestle from the quayside yard westward into the Berbice river, together with the necessary dredging of the river.

Construction of the wharf, perpendicular to the trestle, will follow.

The cargo terminal aspects of the BDWP are targeted to commence in mid-2023 and operation of oil and gas support base in late-2023, subject to construction schedules and supply chains.

In collaboration with the Government of Guyana, CGX has shifted the immediate focus of the Port to service expected demand for aggregates and building materials to support the Government’s infrastructure development in Berbice which must be imported into the region from elsewhere in the country and offshore.

Photo credit: www.noblecorp.com

Globally gas prices are an increasing burden to the motoring public however, in Guyana consumers will be seeing a further reduction in the prices at the pump in the near future.

The Guyana government through the Ministry of Finance has effectively reduced the cost of gasoline and diesel from the Guyana Oil Company Limited (GUYOIL) in a bid to bring further relief to consumers across the country.

Senior Minister in the Office of the President with responsibility for Finance, Hon. Dr. Ashni Singh announced on behalf of the Government a reduction of gasoline and diesel prices at the pump to be charged by the Guyana Oil Company Ltd (GUYOIL).

The prices at the pump charged by GUYOIL will be reduced as follows: gasoline prices reduced by 20 percent from $269 per litre to $215 per litre; and diesel prices reduced by 15 percent from $265 per litre to $225 per litre. 

According to a press release, the Ministry of Finance indicated that during the first half of 2022, global oil prices surged more than 50 percent, increasing from US$77 per barrel at the end December 2021 to US$120 in June of this year; having risen as high as US$137 per barrel primarily because of the Russian invasion of Ukraine. The impact of the dramatic increases in oil prices were significant and given the interconnected nature of the global economy, translated into higher cost of landing fuel in Guyana.

The press release states that, to mitigate the impact of rising global fuel prices on domestic consumers and the productive sectors to which fuel is a key input, the Government lowered the Excise Tax rate on both gasoline and diesel from 10 percent to 0 percent in March of this year. It would be recalled that, previously, during the Budget 2022 presentation, the Government lowered the Excise Tax on both gasoline and diesel from 20 percent to 10 percent to minimize the impact of rising global oil prices.

The Government has been progressively lowering the Excise Tax rate on both gasoline and diesel, from 50 percent to 35 percent in February 2021, 35 percent to 20 percent in October 2021, in keeping with Government’s policy to adjust the taxes on fuel, to mitigate the impact of rising fuel prices on the world market.

Since resuming office in August 2020, the PPP/C Government has implemented a suite of measures to ease cost of living pressures and to improve disposable incomes. In an ongoing effort to address these issues head-on and to mitigate the effects of rising prices globally on all Guyanese citizens.

The reduction in excise taxes is one such of several measures implemented by the Government since assuming office.