Guyana invited to chair group of new oil producing countries – Bharrat

…says invitation recognises country’s stellar handling of oil sector

Guyana has been invited to chair a group of the world’s newest oil producing countries, a development described by Natural Resources Minister Vickram Bharrat as recognition of Guyana’s growing status as an oil producer on the world stage.
In an exclusive interview with this publication, Bharrat revealed that the Government is currently considering the invitation at a policy level, and that the countries making up the group include Ghana, Namibia, and likely Suriname.
“We received correspondence from the global New Producers Group (NPG), that is new petroleum countries. It’s made up of a number of countries that are new in the petroleum sector,” he said.
“They would have invited Guyana to chair that group, I think for the next three years from February. So we have that correspondence in our possession. So at a policy level we’ll make a decision on how we move forward with it.”

As of now, however, the Minister noted that the Government saw no harm in Guyana participating in and chairing this group, noting that it was not an organisation that would be in competition with the Organisation of the Petroleum Exporting Countries (OPEC).
“It definitely shows that Guyana is being recognised among the new oil producing countries. It shows that our framework and the way we’re managing the sector is recognised and accepted worldwide and is of industry standard.”
Bharrat also described the offer as recognition that the Guyana Government has been ensuring the benefits of the oil sector are felt by the people.
The Minister revealed that this is one of the criteria the grouping looked at, in offering Guyana this role.
“It’s not just about being an oil producer. It’s about how well you manage the sector, the resources and revenue from it. And I think our NRF is probably second to none among new producing countries,” the Minister added.
Based on the configuration of the new oil producers’ association, meetings would be held once every quarter of the year… three virtual meetings and one in person meeting.
According to Bharrat, it is likely that the chair country would host that in-person meeting.
Namibia is a country on the South Western coast of Africa with estimated oil reserves of 11 billion barrels. Meanwhile, Ghana has been producing oil since 2010 and currently produces 130,000 barrels of oil per day.
When it comes to Suriname, the country has already signed either production sharing or exploration agreements with Chevron, Shell, TotalEnergies Suriname and QatarEnergy.
In 2022, the Government of Guyana passed the National Resource Fund Bill and established the Natural Resource Fund Board – which has oversight on the country’s oil monies.
The Government has also updated the 1986 Petroleum Act and passed the Petroleum Activities Bill. This piece of legislation aims to improve existing laws governing safety, emergency responses, and other oil and gas-related issues.
Government has also produced a new model Production Sharing Agreement (PSA), which will ultimately see the State’s take rising to over 60 per cent of the current revenue share.
Under the new conditions of the model PSA, Guyana stands to benefit from as high as US$20 million signature bonuses for the deep-water blocks and US$10 million for the shallow-water blocks.
Additionally, all future PSAs would also include the retention of the 50-50 profit-sharing after cost recovery; the increase of the royalty from a mere two per cent to a fixed rate of 10 per cent; the imposition of a 10 per cent corporate tax, and the lowering of the cost recovery ceiling to 65 per cent, from 75 per cent.
Government has also pushed to have in place, local content legislation, which paved the way for the establishment of the Local Content Secretariat, which has been in operation since 2021.