Guyana may revise model offshore contracts for second licensing round – Jagdeo

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The Guyana government may revise its model petroleum agreements for offshore licenses ahead of its second licensing round. 

Vice President Bharrat Jagdeo told a gathering at the Guyana Energy Conference and Supply Chain Expo on Tuesday, “We’ve heard that the PSA [production sharing agreement] is too robust, not necessarily the fiscal terms, but other terms of the PSA. We are looking for that feedback so when we get to the second licensing round, we can update this framework and we believe if we do so, that the interest would be far greater.” 

Groups submitted bids for eight out of the 14 blocks offered. Awards were announced last year, but the contracts still have to be signed.

Jagdeo said the government hopes conference attendees would give feedback on the regime the government established for winners of the first round.

The government had received some negative feedback about the punitive measures of the contracts, including from ExxonMobil. While the government said it was open to minimal amendments during negotiations, it said it did not want to “weaken” the contracts.

The second round may happen this year. The government plans to conduct an internal review of its offshore resources, in anticipation of the potential second round. However, there are no plans for government-commissioned seismic surveys. 

ExxonMobil is set to relinquish a portion of the Stabroek block, which Jagdeo has said may be included in the auction.

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