Young says Trinidad has learned from previous disappointing shallow round

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Trinidad and Tobago’s Ministry of Energy and Energy Industries has officially unveiled its 2023 Shallow Water Competitive Bid Round. Minister Stuart Young stated, “The Shallow-Water Competitive Bid Round 2023 demonstrates the government’s ongoing commitment to the further exploration and development of our hydrocarbon resources in a timely manner.”

The bid round was initiated with the publishing of the Petroleum Regulations (Shallow Water Competitive Bidding) Order, 2023, on October 2, 2023, in the Gazette. Prospective bidders have six months to prepare and submit their applications, with the closing date set for April 2, 2024, at noon. The Trinidad and Tobago government has indicated that successful bidders will be announced within four months of the bid round’s conclusion.

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Thirteen blocks are up for grabs in this round: Block 1(b), Block 2(ab), Block 2(d), Block 21, Block 22(a), Block 22(b), Block 4(c), Guayaguayare (Offshore) Block, Block Lower Reverse L, Block Modified U(c), Block NCMA 2, Block NCMA 3, and Block NCMA 4(a). These blocks are located in the shallow water areas off Trinidad and Tobago’s coastlines. Collectively, they hold an estimated unrisked resource of approximately 13.4 trillion cubic feet (TCF) of gas.

The selection of these blocks was informed by technical evaluations conducted by an internal team and nominations from stakeholders. Available 2D and 3D seismic data, obtained through various initiatives, will be instrumental in aiding companies in assessing the viability of the blocks.

Promotions of the round took place in cities such as Houston, Mexico City, and Suriname. Furthermore, as of March 2023, a virtual data room containing relevant datasets was accessed by 28 major oil and gas corporations.

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Minister Young highlighted that this was the first Shallow Water Bid Round since 2018. He said lessons from the previous round’s disappointing outcome led to a comprehensive internal review of the bid process and fiscal terms. As a result, there are now no pre-bid fees and bid fees have been significantly reduced. Noteworthy provisions in the Shallow-Water Model Production Sharing Contract include fiscal stability through a ring-fenced Production Sharing Contract and cost recovery up to 60%.

The Ministry of Energy and Energy Industries has been active in its efforts to maximise Trinidad and Tobago’s hydrocarbon resources. Recently, licenses were awarded for onshore bid rounds, and Production Sharing Contracts were issued for deep-water bid rounds. Looking ahead, a new deep-water bid round is planned for 2024, offering blocks off the North and East Coast of Trinidad and Tobago.

Minister Young also informed attendees of the completion of audits on the Non-Associated Natural Gas Reserves and Resources as of December 31, 2021, and December 31, 2022, by DeGolyer and MacNaughton of Dallas, Texas, USA. Public dissemination of the audit results will occur soon.

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