Traders have another opportunity to bid for lifting Liza Crude

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The new PPP/C administration in Guyana has taken a decision to reopen the tender for the provision of marketing services for the country’s share of Liza Crude.

Speaking at a press conference on Friday in Georgetown, Vice President, Bharrat Jagdeo, said the government has put the evaluation process for the companies that were shortlisted, on hold.

Several traders and firms, including oil majors, were among 19 companies that were shortlisted by a five-member Evaluation Committee formed by the Department of Energy (DE) as part of the process to hire a firm to market the country’s share of Liza Crude.

“We made it plain in the [elections] campaign that people should not be submitting bids to an illegal government that was there at that time,” Mr Jagdeo said, referring to the APNU+AFC coalition that was in office a year after a no-confidence vote was moved against the government and five months after the coalition lost in elections held earlier this year.

He said to evaluate the bids sent in at a time when the government’s legal status was in question “would be unfair to people who acted decently, the companies who acted decently and did not put in a bid because they recognise the threat to democracy and you had an illegal government, that they now be excluded from the process; because they are moving ahead to evaluate the bids that were received in the period when the government was illegal.”

DE had issued an invitation for Expression of Interest in February 2020 which saw 34 companies responding, from which the 19 were shortlisted in June.

In response to queries on Thursday by OilNOW about the status of the process, DE Director, Dr. Mark Bynoe had said no decision has been made. “The new Administration has expressed a desire to review the process to date before…proceeding further.”

Expanding on this, Mr. Jagdeo said, “So, we have made it clear that we have reopened the tender for that contract so people, all those who did not get a chance to bid, they can now submit their bids.”

Shell Western Supply and Trading Limited was initially hired to lift the country’s first three 1-million-barrel oil cargoes, all of which have already been sold with a total of approximately 2 more lifts remaining for 2020.

The new contract with the successful company is expected to be on a 12-month basis.

Projected lifting costs for Liza partners will be just over $10 per barrel for the full year, according to Ruaraidh Montgomery, director of research at Houston-based consultancy Welligence.

Guyana began producing oil at the Liza Phase 1 Development in the ExxonMobil-operated Stabroek Bock in December 2019.

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