India signals interest in exploration, buying oil from Guyana

There are uncertainties regarding whether Guyana would keep or share out its remaining offshore oil blocks, but the Indian Government has indicated its interest in exploration activities here.
This was revealed by Indian High Commissioner Venkatachalam Mahalingam during a press conference held at his Church Street, Georgetown office on Thursday.

“…definitely, there is an active interest by Government of India in exploring oil by having an oil block in Guyana,” he said.
According to the High Commissioner, this was conveyed to Guyana’s Natural Resources Minister Raphael Trotman, who was part of a high-level delegation to India, led by Second Vice President and Foreign Affairs Minister Carl Greenidge back in February. The Guyanese Ministers had met with Indian Minister of Petroleum and Natural Gas, Dharmendra Pradhan.
While High Commissioner Mahalingam has noted that there has been follow-up correspondence between the responsible ministries of the two countries, he could not say whether the Indian Government had made a formal application to obtain licences to conduct exploration of Guyana’s offshore oil blocks.
“I don’t know; it is quite possible, because, you know, sometimes our Ministry directly gets in touch with the relevant Ministry. They don’t come through the Foreign Office because it’s a big business, and then there’s an established practice of just (going) directly… So it’s quite possible that the Ministry of Oil and Gas could’ve written to the Ministry of Natural Resources, but we don’t know and we’re not aware of it,” the Indian diplomat stated.
During the February ministerial meeting with Guyanese representatives, Minister Pradhan had stated on his tweet that he “had a useful discussion” with the Guyana delegation, and that they “discussed the possibilities of E&P (exploration & production) activities by Indian companies in Guyana.”
According to the Indian Minister of Petroleum and Natural Gas on his twitter handle, the meeting with the Guyanese Ministers was useful, since they “discussed the possibilities of E&P (Exploration & Production) activities by Indian companies in Guyana.”
Moreover, he noted that India had agreed to work with Guyana and share its experience in the oil and gas sector. In fact, Pradhan had twitted: “(India) agreed to work with Guyana and share our experience in the entire gamut of hydrocarbon sector… (We) will share India’s cumulative experience in refinery, petrochemicals and capacity-building in the oil-and-gas sector.”
“Guyana being the new member of the oil club, last time when Vice President and Foreign Affairs Minister visited, there was an assurance that India can help in downstream, midstream and upstream; and it is for the Government of Guyana to come back to us in which area Guyana would like to have cooperation with India,” High Commissioner Mahalingam added on Thursday.
He went on to say that, in addition to wanting to help Guyana develop its oil and gas sector, India is also interested in buying oil from Guyana when production starts in 2020.
“We have also expressed our interest in buying oil if it’s available, because we buy oil from Latin America and South America. We buy oil from Venezuela, we buy oil from Colombia; so we can also buy oil from Guyana,” he posited.
According to the Indian diplomat, there has since been correspondence between India’s Ministry of Petroleum and Natural Gas and Guyana’s Natural Resources Ministry to exchange relevant data.
Even as Government contemplates its next move regarding Guyana’s offshore oil blocks, former President and current Opposition Leader, Bharrat Jagdeo, has called for the implementation of competitive bidding for the remaining oil blocks, or for the blocks to be kept for future generations.
Jagdeo has been extremely critical of Government’s handling of the Petroleum Sharing Agreement (PSA) with the oil companies that have interests in Guyana. However, Government has said that a process of both direct engagement and selective bidding would be used to allocate the remaining blocks.
In fact, Minister Trotman has expressed that direct engagements with other State-owned companies, such as Brazil’s Petrobras, would be sought in the future,
But local attorney Melinda Janki, who has extensive experience working with many oil companies, has cautioned Government against making rash decisions when it comes to the remaining oil blocks offshore Guyana.
Janki, who worked as an in-legal counsel for British multinational oil and gas company BP, at its head office in London, has reminded that the Constitution of Guyana sets limits on what can be done with Guyana’s natural resources.
During an exclusive interview with Guyana Times last week, the attorney further opined that there is a legal duty to hand on to the next generation, an intact natural capital base.
According to her, this is clear from Article 36 of the Constitution, which also states: “The wellbeing of the nation depends upon preserving clean air, fertile soils, pure water, and the rich diversity of plants, animals and eco-systems.”
Janki maintains that money can’t be eaten, nor can oil be drunk.
“The Government has to comply with Article 36. They have to preserve clean air, fertile soils, pure water, and the rich diversity of plants, animals and eco-systems. Before they auction any blocks, they must correct the mistakes they have made in the deal with Esso, Hess and Nexen,” she added.