…features production share pegged at US$100 per barrel price; 50/50 profit split up to 50,000 barrels per day

THE Ministry of Natural Resources yesterday released yet another Production Sharing Agreement, this time for NABI Oil and Gas Inc.

“The Ministry of Natural Resources, in keeping with its commitment to release major contracts between the Government of the Cooperative Republic of Guyana and companies in the extractive industries sector, now makes available the contract with NABI Oil and Gas Inc.,” the Ministry said in a press release yesterday.

The contract was signed in June 2012 by then President Donald Ramotar and Company Secretary/Director of Nabi Oil and Gas Inc., Rafael S. Nabi.

In June 2012, the company was granted a lease for 2,300 square kilometres onshore in the Mahaica-Mahaicony, East Coast Demerara area. This area is considered part of the Guyana Basin which encompasses both onshore and offshore.

The Ministry noted that during the last quarter of 2013, the company conducted a geochemistry survey and was in the process of analyzing the data it had gathered. The company’s activities have, however, been dormant since that time.

The released PSA features a cost-recovery ceiling 70 per cent pegged on the price of oil being US$100 and above per barrel and 75 per cent should the price fall below US$100.
The remaining 25 per cent or 30 percent portion of profit oil will be split between the contractor and Government on a 50/50 basis if production remains below 50,000 barrels per day. Should it top that level, the production will be shared on a 55/45 in favour of Government. Royalty is one per cent payable from the Government’s share of the profits.

The PSA for NABI Oil and Gas Inc. does not have a signing bonus clause but does feature a Stability Clause not unlike those that have been included in the other released PSAs. Since the release of the ExxonMobil PSA in late December 2017, the Government has released PSAs for CGX Resources Inc., Eco-Atlantic Oil and Gas and Tullow Oil and Ratio Energy Inc.
NABI Oil & Gas Inc. is a locally owned company that started in 2010 as a project management, logistical support, drilling, energy and construction company.