Oct 24, 2021 News
– Guyana gives away Stabroek Block with massive find for US$18M
Kaieteur News – Suriname’s national oil company, Staatsolie, announced on October 13, 2021, that it is poised to sign a Production Sharing Contract (PSC) with Chevron for the rights to explore, develop and produce in the shallow waters offshore the Dutch-speaking country. By utilising a bidding round as opposed to a one-on-one negotiation and award of the block, Suriname was able to garner several benefits for its offshore concession, which has no discoveries.
One of the major achievements is that it was able to secure US$30.8M for a block that spans 2,235km2. Also of significance is the fact that Staatsolie, for the first time in its history, will participate as a partner in offshore activities since it retained a 40 percent participation right from the moment the PSC is signed. The cooperation was confirmed by the signing of the Joint Operating Agreement (JOA) in which the conditions are specified. The agreements enable Staatsolie to have more influence in the decision-making process and mean that Staatsolie will co-finance as a partner in the possible development and production phase.
Kaieteur News understands that Chevron showed interest in Block 5 at the Suriname Shallow Offshore Bid Round 2020/2021. In this tendering round, interested companies bid for blocks in the so-called shallow offshore, the sea area up to 120 kilometres from the coast and with a water depth of up to 100 metres. Chevron made the most favourable offer for Block 5.
In stark contrast, Suriname’s CARICOM sister, being Guyana, secured only US$18M as a signing bonus after ExxonMobil made a significant discovery in the Stabroek Block. It is important to note that the Stabroek Block is 12 times the size of Block 5. More importantly, when the signing bonus was received, at a time when ExxonMobil should have relinquished more than 20 percent of the oil rich block and was able to hold onto it.
As for the Kaieteur and Canje Blocks, which are combined, almost nine times the size of Block 5, they were awarded back in 2015 by the Donald Ramotar Administration to industry unknowns without any signing bonus being required. ExxonMobil has since farmed into both blocks and is now the operator.
In a previous interview, Oil Consultant and former advisor to President Granger, Dr. Jan Mangal, had said Guyana likely forfeited US$100’s millions or even a billion dollars in signing bonuses for the foregoing blocks. He noted that these blocks, being Kaieteur and Canje, are adjacent to the Stabroek Block, which is operated by ExxonMobil and is now known to hold over 5.5B of oil equivalent resources. ExxonMobil has since submitted applications to the Environmental Protection Agency (EPA) to pursue 12 wells in each block.
CANJE BLOCK OPERATORS
The company to which Ramotar signed away the Canje Block was Mid-Atlantic Oil and Gas. JHI Associates Inc. subsequently farmed in (or bought in) right after. The block was awarded on March 4, 2015 to Mid-Atlantic.
JHI was only registered in Guyana on May 4 and it bought into the block on May 15. It seems JHI was created from nothing as its archived website only started working and listing managers, including John Cullen, on June 10, 2015.
The general election was on May 11, 2015.
According to documents held by the Extractive Industries Transparency Initiative (EITI) Secretariat, JHI was only incorporated on June 17, 2015, in the British Virgin Islands. This nation is under no obligation to provide countries like Guyana with tax information of companies registered there.
And even though Mid-Atlantic Oil and Gas was incorporated here on April 8, 2013, both companies were in one-on-one negotiations with the PPP government for the oil block one month before, that is, March 2013.
This means that the individuals behind the companies were asking for oil blocks without having a company being formed as yet. What is also significant to note is that the Canje Block is the only asset that these two companies have to date. Additionally, JHI and Mid-Atlantic, which participated in Guyana’s EITI reporting process, failed to submit their audited financial statements for review.
THE KAIETEUR BLOCK
Ramotar awarded the Kaieteur Block to Ratio Energy Limited and Ratio Guyana on April 28, 2015. Both companies are registered at the same offices in Prashad Nagar and Gibraltar, Israel.
Ratio Guyana does not have a website but on the Kaieteur Block’s Production Sharing Agreement (PSA), a Ryan Pereira is signed on as the Company Secretary, Director and General Partner of the company.
It also should be noted that Mr. Pereira is a long-time miner in Guyana with no track record in oil. Yet, the last government awarded him (Cataleya Energy) 50 percent of the block.
The Ratio duo’s only asset remains the Kaieteur Block. Not a trace of evidence can be found to prove that it has years of experience in the exploration of oil and gas (SEE LINK FOR PSA: https://resourcecontracts.org/contract/ocds-591adf-2701587320/view#/pdf).
Ratio Energy, which also calls itself Ratio Petroleum is chaired by Ligad Rotlevy. With the Kaieteur Block in hand in 2015, this Israeli company was able to capture three other blocks. In 2017, it was able to acquire rights in Suriname’s basin, specifically for Block 47. In June 2016, Ratio Petroleum was granted a licence to operate in the Exclusive Economic Zone of Ireland.
In October 2018, the Government of the Republic of the Philippines and Ratio entered into a Production Sharing Agreement, for oil exploration in an offshore section of Philippines continental shelf, known as SC 76. But Ratio does not have a track record of producing any oil in deepwater or anywhere, nor does it have the required assets to do so.
Of its four assets, Guyana’s Kaieteur Block is its largest (SEE WEBSITE LINK FOR MORE INFORMATION: https://www.ratiopetroleum.com/en/about/ratio-petroleum/).
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