Guyana could rake in $$ billions if data is made available on relinquished oil blocks – Industry experts
By Kemol King
Oil companies would prefer it if the data they have accumulated on areas they have studied are kept secret, even after those areas ceases being theirs to operate. That’s because the revelation of that data to other oil companies and the general public could lead to billions of dollars in signing bonuses for Guyana, particularly for parts of the Stabroek Block.
Map showing blocks in which ExxonMobil owns stakes. The company’s 15 material discoveries have so far been concentrated in the southern end of the Block
This was told to Kaieteur News in discussions with several industry experts.
ExxonMobil is slated to relinquish 20 percent of the behemoth 6.6 million-acre Block on October 7, 2020. The Production Sharing Agreement (PSA) it signed with Government in 2016 requires such a relinquishment after the first renewal period, which is four years.
It is typical for data to be kept confidential when a contract covers the concerned area. But after the relinquishment clause of the PSA is fulfilled, 1.3 million acres of the current contract area will no longer be covered by the agreement.
That acreage could form several new blocks. And the data that concerns it will be the sole property of the State.
At this point, many oil companies will fork up attractive offers for the rights to the relinquished areas. The area that is now the Stabroek Block has been proven to contain billions in high quality oil-equivalent barrels.
Government’s opportunity to get more value for the people doesn’t end there.
It is likely that ExxonMobil has already studied the data to determine which Blocks it intends to farm into in the future. Government can do whatever it wants with the data ExxonMobil will relinquish, including publishing it.
If it does that, other oil companies can study it and determine which parts of the relinquished area are more attractive and likely to contain commercial reserves than others.
All that does is give some of ExxonMobil’s competitive advantage to other companies, and makes it easier for Guyana to rake in billions of dollars.
When pressed about the meager US$18M signing bonus it collected for handing over Stabroek Block rights to ExxonMobil, one of Government’s justifications was that it didn’t know just how much value was there.
This time around, Kaieteur News would have already pointed out how other nations were able to collect large sums for acreage that was less valuable.
Stabroek Block acreage isn’t the only acreage that relinquishment concerns. ExxonMobil has already relinquished 20 percent of the Canje Block. Others are to be relinquished in the coming years.
Guyana’s future opportunities are vast.