Stabroek News Guyana to get higher share of profit from increased production under Repsol deal

Repsol Director (Global New Ventures) Mikel Erquiaga (second, from right) and a team from the company with Minister of Natural Resources Raphael Trotman (at right), whom they met last month. During the meeting, they are reported to have reiterated Repsol’s commitment to its Guyana operations and an aggressive programme of activities that would move swiftly from seismic surveys to exploratory drilling. (Ministry of Natural Resources photo)

Under the contract and an amendment signed between Guyana and Repsol Exploracion S.A, Guyana stands to gain a higher percentage of profits with increased production.

Production sharing agreements between government and oil companies vary, with some catering for a graduated scale of sharing of profit oil and others for an even split.

Some companies, such as Repsol, Tullow Oil and Eco (Atlantic) Oil and Gas, agreed to government’s profit split going as high as 60%, depending on the barrels of oil produced per day [BOPD], while others like ExxonMobil and Anadarko have agreed to a 50:50 share.

Under the oversight of Natural Resources Minister Raphael Trotman, the 2016 agreement signed between government and ExxonMobil has been heavily criticised and his APNU+AFC government has been pilloried over what has been seen as a poor deal.