Guyana and India are on the brink of inking a trailblazing Memorandum of Understanding (MoU) on the energy sector. The document which is currently being reviewed by India’s Cabinet could allow for the purchase of Stabroek Block crude, capacity development in the Natural Resources Ministry, consultation on natural gas, and government-to-government participation in oil blocks exploration.
Vice President, Dr. Bharrat Jagdeo outlined some of the foregoing terms that will feature in the MoU during a press conference on Friday at the Arthur Chung Convention Centre.
Dr. Jagdeo said the terms were hammered out and solidified during his recent six-day visit to the Asian state. He said the MoU will allow for India to purchase Guyana’s sweet light crude but only if the conditions are competitive and follow market conditions. The chief policy maker in the oil sector categorically stated industry players must bear in mind that there is no agreement, in any shape or form, on the table at this time for India to purchase crude from Guyana.
Turning to capacity building, the Vice President said Guyana is eager to adopt some of the best practices employed by India in the oil industry. In this regard, he said there is an agreement for experts to help up-skill the Ministry of Natural Resources.
On natural gas, Dr. Jagdeo said the MoU will allow for Indian consultants to help Guyanese authorities refine their Natural Gas Strategy (NGS) which is separate from the Gas Utilisation Plan being drafted by ExxonMobil affiliate, Esso Exploration and Production Guyana Limited (EEPGL). He said the NGS will be the overarching framework or roadmap for Guyana’s gas resources that lay outside of the Liza field that will feed the coveted Gas-to-Energy project.
Also significant, he said, are provisions that will allow for bilateral cooperation in the exploration and development of the nation’s natural resources. “As you know, we started this off by saying we were exploring whether we would utilise the other areas offshore through a National Oil Company or we would go to auction and we decided that at this stage we will not establish a NOC but auction 14 areas. There are several areas offshore that were not auctioned,” the Vice President.
He said those will be available for bilateral engagements and will include 20% of the Stabroek Block to be relinquished next year. If these bilateral engagements are not as fruitful as expected, Jagdeo said the concessions would be part of the next licensing round.
Once signed, the Vice President said the MoU which also looks at renewable energy, will be in the public domain.
