The Government of Guyana is hoping to release the draft of its new Petroleum Act to the public by Monday, June 19, says Vice President Dr. Bharrat Jagdeo. During his weekly press conference held today, he announced that the disclosure of the draft law would be accompanied by a period of public consultation and allow all stakeholders, which includes the parliamentary opposition, to provide their comments and feedback.
Jagdeo had previously emphasized the need for an updated Petroleum Act, stating that the current legislation from 1986 is outdated and requires strengthening. He had said also that the government aims to establish a comprehensive framework of international best practices through the new act.
In addition to the Petroleum Act, the government is also finalizing the drafts for its new model production sharing agreements (PSAs) that will govern Guyana’s deep and shallow water concessions. Jagdeo mentioned that both deep water and shallow water models have been developed, incorporating feedback from various stakeholders and the finalization of these PSAs will be followed by another policy review to ensure their alignment with the government’s objectives.
It is important to note that the amendments to the Petroleum Act are being made to support the fiscal and regulatory changes outlined in the new model PSAs, which are nearing completion. These updates are aimed at providing investors with a comprehensive package for the upcoming 2022 Licensing Round, Guyana’s maiden auction. The licensing round will include 14 blocks, comprising three deepwater blocks and 11 shallow water blocks, estimated to hold approximately 25 billion oil-equivalent barrels.
To accommodate industry feedback and the progress in modernizing the oil and gas regulatory framework, the government had extended the bid submission deadline from April 14, 2023, to July 15, 2023. This three-month extension allowed interested parties to participate effectively in the auction process.
The new model PSAs to be finalized will be inked between Guyana’s government and the countries or companies that successfully bid for the 14 oil blocks. The awards for the blocks are expected by the third quarter of 2023 and the government has reaffirmed that the new model PSAs will be ready in time.
