Guyana’s new draft Petroleum Activities Bill includes a framework to allow for the regulation of underground carbon storage.
The Minister with responsibility for Petroleum would have the power to grant rights for prospecting for and exploration of underground carbon dioxide (CO₂) storage sites.
Apart from the prospecting license, parties may receive a carbon storage license, which bestows the exclusive right to explore for potential storage sites in a license area, and to develop the site, allowing for permanent storage of CO₂.
Exploring opportunities for potential CO₂ storage sites will enable the government to facilitate the development of petroleum resources while minimising Guyana’s carbon footprint, the Ministry of Natural Resources said in a release.
A carbon storage regime is a progressive move for a small, developing nation like Guyana. The framework allows for Guyana to auction off carbon storage areas. One such auction was implemented recently for the first time in the United Kingdom. That country expects carbon storage to be a significant contributor on its way to net zero.
As many countries work to achieve net zero status by 2050, the Guyana government insists it is already at net zero due to its vast forest cover. However, the government has said it will continue to seek avenues to mitigate its footprint as it develops.
Carbon storage licensing will add to the repertoire of practices employed by Guyana as a conservationist nation. The country already stores tremendous amounts of carbon with over 85% of its land mass covered with forests. In 2022, Guyana became the first country in the world to be issued carbon credits specifically designed for the voluntary and compliance carbon markets for successfully preventing forest loss and degradation, by Architecture for REDD+ Transactions (ART).
The public consultation phase for the proposed law will span two weeks, commencing Tuesday, June 20 and concluding on Monday, July 3, 2023. It is expected to be passed into law in the third quarter.
