firms are waiting
Oil analysts and experts say they do not expect the new PSA model to meet its January 31 deadline, amid incomplete contract language, legislative changes needed to reflect the new framework and auctions to be held pending work.
Guyana’s Finance Minister, Ashani Singh, said on Monday that the licensing round would remain open until April 14, with successful bids due by the end of the first half of the year.
US firm IHSMarkit was chosen as the lead consultant for the auction last year.
To bring more companies into the auction, Guyana did not limit the number of blocks that companies could bid for, but would limit the awards to three per company.
Winners will be required to submit work programs as part of their bids and provide guarantees on those programs. If winners do not complete investment programs as required, the government can impose fines or withhold acreage from future auctions.
“We want a bigger business,” Guyana’s vice president Bharat Jagdev said in November. “It’s trying to solve a lot of the problems that we have with other areas where people just sat on these and then they discarded them after a long period of time.”
Last year, Exxon, Hess Corp and China’s CNOOC increased oil production and exports with their second production vessel. Production began to increase just before global demand picked up following Russia’s invasion of Ukraine and the resulting sanctions.