Government has announced that it is looking for marketers of oil from the Liza 1 and Liza 2 platforms but for a second time has not released to the public information on the requirements or the specific period the contract would cover.
Unlike in the past where the information was shared on what criteria they should meet, the Ministry of Natural Resources is again asking interested bidders to write seeking whatever clarity is needed for the bids that will be opened on October 11, 2022.
“The Ministry of Natural Resources, hereinafter referred to as “the procuring entity” invites eligible bidders to submit their bids for the provision of marketing services for the cooperative republic of Guyana’s Oil Entitlement from Lot –Liza Destiny FPSO Vessel and Lot 2-Liza Unity FPSO Vessel,” a notice from the Ministry states.
It said that “Interested bidders may obtain further information by email at jmckenzie@nre.gov.gy.”
It is unclear why information on the processes was withheld but calls to both Minister of Natural Resources Vickram Bharrat and the ministry’s Permanent Secretary Joslyn Mackenzie went unanswered.
There has been no marketer for oil share from the Liza Unity, which has been in operation since February of this year, as government had said it would undertake the task itself until it “fleshes out” what would be the regime going forward.
For this country’s oil share from the Liza Destiny FPSO, the contracted marketer had been the Saudi Arabia-based Aramco company and its contract expired on August 31st of this year.
The Government of Guyana has said that it will receive 12 lifts for this year from the 96.3M barrels of oil equivalent expected to be produced from the Stabroek Block.
Last month, Senior Petroleum Coordinator within the Natural Resources Ministry Bobby Gossai Jr had told this newspaper that there had been “three (3) lifts of profit oil from Liza Destiny FPSO for 2022 thus far” and “another three (3) lifts” were expected during the remainder of the year.
It is also unclear when the next oil lifts are due.
Government has said that it would have been setting up a portal dedicated to making information on the oil and gas sector public but to date there has been no such website or sub-link on the MNR’s website.
Sparse public information is given about the upcoming tender process but the ministry notes that the bids will be divided into lots. It did not state how many lots or for what period each lot covered.
“This bid is conducted on lots of basis [lots division basis]. Bidders may bid for one or more lots as defined in the bidding documents. Firms must submit the original and two copies and electronic non-editable copies of the bid for each lot. The bidder shall seal the signed bid in an envelope addressed to the National Procurement and Tender Administration Board,” the notice informs.
Last year August, government had confirmed that Aramco’s contract “is for a year; the 12 months starting from September to August next year.”
This year, it had said that it would be marketing oil from Unity, using the spot sale system, a provision catered for under the crude lifting agreement, until a determination of the way forward.
Directly selling its oil share from that project to India was also being explored.
“That [selling to India] is something we will consider, too. But, of course, we would like it to be an open, transparent process. We have always mentioned it should be that way. We are considering the option of India but then we are looking at making it an open process,” the Minister of Natural Resources had said.
“What we are looking at, too, is not marketing but selling [ourselves]. In that way we save on the marketing fee. So if any country, India, or any company, is willing to do that, we may be open to talk about that. That way this country would actually save money,” he had added, while noting that government will assess the best option for this country.
However, main opposition coalition partner the Alliance for Change had expressed concern over the prospect of the government directly marketing the country’s share of crude oil, bypassing existing established marketing mechanisms.
General Secretary of the AFC and current Natural Resources shadow minister in Parliament, David Patterson, had said such a move would not only signal a significantly frightening development, but raise questions about the policy direction, whether it has been well researched and the potential benefits quantified.
“Guyana, a new oil-producing country without the requisite industry experience, should seek partnerships to leverage our bargaining power. The PPP regime should not traverse beyond the usual bi-lateral agreement between nation-states, and all such resulting commercial contracts should be subject to parliamentary oversight and approval,” Patterson said.
