The government of The Bahamas has awarded an extension of the second exploration period on four offshore licenses to Bahamas Petroleum Company (BPC).
The four licenses in question are the 100 percent-owned Bain, Cooper, Donaldson, and Eneas licenses. BPC said the licenses would be extended until December 31, 2020. During the extension period, Bahamas Petroleum Company has an obligation to drill an exploration well.
After this period, based on the results of the initial exploration well, BPC will have the option to apply for a production lease over all or part of the license area. Bahamas Petroleum will also have the option to extend the licenses into a third exploration period and/or apply for an appraisal extension.
“The notification received from the Government also stipulates that the Government and BPC must in the coming months agree a forward work program for 2019 and 2020 and a reconciliation of license fees already paid, including during the period of disruption, with any future license fees due up to the end of 2020,” BPC said.
The forward program will include the process for environmental authorization based upon an application already submitted by the Bahamas Petroleum Company in April 2018.
Bahamas Petroleum Company last year suffered a setback after an unnamed oil major pulled out from exclusive talks with BPC over a potential a farm-in.
BPC then said it resumed broader, asset-based discussions with third parties in addition to those non-asset based financing discussions already ongoing for the funding of its first exploration well.
The company believes there’s a multi-billion barrel potential in the area. According to a BPC presentation of a conceptual forward work plan from June 2017, an exploration well was to be drilled in 2018 – which didn’t happen – and in case of a discovery, an appraisal well was to follow in late 2019, with production start in 2023 via an FPSO. BPC’s plans may still materialize, however, with revised timelines.
In a statement on Friday, February 22, Bahamas Petroleum Company said it was still looking to secure a farm-in partner for the initial exploration well and that discussions were continuing with multiple third parties.
Simon Potter, CEO of Bahamas Petroleum Company, said: “The confirmation from the Government of The Bahamas that the current term of our four southern licenses extends to December 31, 2020, provides the company with a certainty of tenure over the company’s licenses, replacing any perceived “above ground” issues with complete clarity in fact and law.
“[…] there is now a very clear two-year window to advance plans for and to drill an exploratory well providing certainty to potential partners as we move forward in our farm-out discussions. BPC’s focus remains singular: to implement an exploratory well on its highly prospective assets in The Bahamas to the benefit of shareholders and the people of The Bahamas.”
Offshore Energy Today Staff