IN accordance with its Production Sharing Agreement (PSA) with Guyana, Exxon Mobil has relinquished 20 per cent of the Canje Block.

The relinquishment was announced by Department of Energy Director, Dr. Mark Bynoe, at a press conference on Monday.

The move comes as Esso Exploration and Production Guyana Limited (EEPGL), ExxonMobil’s subsidiary, had submitted a Canje Block licence renewal application, including an area to be relinquished, in accordance with the Canje Petroleum Agreement and all applicable laws and regulations.

Under Article 4 of the agreement, the contractor shall elect either to relinquish the entire contract area or relinquish 20 per cent and renew the Petroleum Prospecting Licence for a period of up to three years.

The relinquishment was not contingent with Exxon’s work programme, which has been fully completed.

At the press conference, Dr. Bynoe said that, even so, the department is not in a rush to head into another licensing round as several measures must first be put in place to safeguard the best deal for Guyana.

“In terms of relinquishment, that is part of what the department does; it is part of our responsibility. The first three years, for example, with the Canje Block, they had relinquished 20 per cent and that will continue to be how the sector is managed,” Dr. Bynoe stated.

Regarding reallocation of the same, he said the department is keen to cover important stages such as the legal revision of Guyana’s PSA before heading back into this direction. The department now has a revised best practice PSA template and is determined to ensure that there is balance so that Guyana can increase its negotiating position.

“We’re not going back to market with a 1986 Petroleum Act. As we’ve been on record of indicating, that Act is fairly silent on mid and downstream activities. We need to make it a lot more robust with regards to decommissioning as well as how it fits in with the local content we mentioned that we are elaborating. So, those pieces need to be in there before we go out to market,” stated Dr. Bynoe.

Meanwhile, the department is also recruiting a firm to complete a 2D/3D multi-client seismic survey which will enable Guyana to negotiate in the future based on the assets it believes it has. “That is in its latter stages of completion so that we are able to provide packages from a position of knowledge. That a 2D/3D multi-client seismic survey is likely to take an average of 11 months – shooting and processing of the data – so when those are completed, then we go back to market,” the department head explained. He made it clear that there is still a “multiplicity” of sizeable blocks offshore Guyana which still require exploration. Dr. Bynoe therefore added: “So, is there an absolute need for us to go to another licensing round now? I would say no [but] it is important for us to have improvements as we move forward.”