THE Energy Ministry and Australian energy giant BHP Billiton yesterday signed production sharing contracts (PSC) for oil and gas exploration in five deepwater blocks off Trinidad’s east/northeast coast.
Blocks 5, 6, 28 and 29 were offered to potential investors by the ministry for exploration in its 2012 Deepwater Bid Round. Last December, the ministry announced that BHP Billiton and its consortium partners had won.
“BHP Billiton is pleased to have been awarded (these blocks). The total area of these four blocks is over 4,100 square kilometres. This now means that Trinidad and Tobago is among the countries in which BHP holds our most significant acreage positions,” BHP Billiton T&T president Vincent Pereira said during the signing ceremony at the Hilton Trinidad in Port of Spain yesterday.
Pereira said the country remained an important part of the company’s portfolio.
“It has the investment climate, people, talent and resource base for a successful business. This new exploration acreage is evidence of our continuing commitment to Trinidad and Tobago,” he said.
He said the company intends to start its 3D seismic data acquisition programme during the first half of next year, with plans to commence drilling three years after acquiring this data.
Last week, bpTT president Norman Christie said the company was in talks with BHP to combine seismic data collection activity as a more cost-effective measure.
BHP confirmed this to the Express on Tuesday.
Energy Minister Kevin Ramnarine said the signing ceremony came about as a consequence of over a year’s work by the ministry to shift policy that recognises the need to remain competitive to attract investment.
“With the execution of these four PSCs, BHP is committed to a total investment of approximately US$565 million for the first exploration phase and a further US$459 million over optional phases. This means (a potential investment of) US$1.2 billion. That is significant,” Ramnarine said.
Under the PSC, BHP is committed to a Minimum Exploration Work Programme based on proposals put forward in the company’s bid submissions. Each PSC includes provision for cost recovery and the sharing of production. The programme involves collecting over 5,000 square kilometres of 3D seismic and drilling six exploration wells.
Preliminary estimates of the natural gas resource potential of these blocks are in the range of 2.4 to 23.6 trillion cubic feet, and crude oil resources are estimated anywhere from 428 to 4,200 million barrels of oil.
Ramnarine also said since the onshore bid round 2013 was launched last month, the ministry has sold ten data packages at $40,000 per each.
He added he will take a note to Cabinet shortly for the draft Competitive Bidding Order to give effect to the 2013 deepwater bid round.