India has been asked to submit a written proposal outlining its interest in the oil and gas sector here, according to President Irfaan Ali.
“There has been a keen interest, consistently from India, to be a long-term purchaser of crude oil from Guyana. In addition to that interest, they have expressed also a keen desire to support us in the entire ecosystem around the oil and gas sector,” Ali yesterday told a press conference when asked by Stabroek News of New Delhi’s interest.
“I said to the team that they should put in a proposal as to what exactly they are proposing, in terms of a long- term agreement, and that has to be examined technically. In a meeting with the Minis-ter, the interest of exploring that government-to-government collaboration was very clear,” he added.
Pointing out that the interest expressed was “nothing new” as “India has made it very clear that they have an interest in being one of the purchasers of Guyana’s oil,” Ali said that government cannot make a decision until they know directly and formally what it is that New Delhi expects. “The technical teams will work and see what proposals India would forward,” he said, as he listed other areas of collaboration.
“It is not only in terms of lift. India’s interest is also to see how they can work with us and the entire ecosystem surrounding our oil and gas, whether it’s technology transfer, trading of our human resources, building capacity, in terms of the value-added services that is required for the oil and gas sector, purchasing of crude oil … or investment,” he said.
During his recent visit to India, Ali met with Hardeep Singh Puri, India’s Petroleum Minister. Following the meeting, Puri had tweeted: “Dis-cussed direct Government to Government cooperation across entire spectrum of oil & gas sector including increased long term offtake, participation in exploration & production activities in Guyana, technical cooperation in midstream & downstream sector & capacity building”.
Ali explained that this country sought to galvanize interest from the Indian private sector so that they can participate in the upcoming auction of offshore blocks and government made clear to the Indian government, as it has with other nations, that they too can bid.
“There was also a clear undertaking that the private sector of India wants to partake in that auction… we also encouraged the Government of India to have their agency participate directly in the auction because we would like to see as much people [as possible]. Every government interested and would like to participate in the auction, we would like see participate,” he stressed.
And as he issued a public invitation for bidding at the auction, the President said that government hopes for maximum participation. “We are encouraging every single company. Let me say this very clear – Guyanese company, any company. You want to be part of the auction? Please come up. Any government in any part of the world, any company in any part of the world, you are free to be a part of the auction,” he emphasised.
Last December, as he stressed the need to expeditiously move to develop the country’s oil and gas resources, Ali had announced the launch of the licensing round for 14 offshore oil blocks.
“We have a situation where there is a timeframe on oil and gas development. We understand the direction in which the world is going, so it is very important for us to have developers who are serious, who will expeditiously move towards developments of the oil and gas resources.”
He added that April 14, 2023 has been set as the deadline for the close of submission for bids, and contracts are expected to be awarded by the end of May, 2023, following the evaluation of bids and negotiations.
The blocks being offered in what is the country’s first licensing round are located in shallow and deepwater areas offshore, which are estimated to hold potential resources in excess of 25 billion barrels of oil equivalent (boe) and an estimated reserve in excess of 11 billion boe.
The minimum signature bonus requirement of US$10 million for shallow-water blocks and US$20 million for deepwater blocks were among new fiscal terms and conditions announced last month.
Ali assured that the process will be transparent and there will be different requirements and qualifications for shallow and deepwater operations reflective of international best practices given the different types of expertise and capabilities that are required.
