Oil blocks’ auction: Standing among giants: Sispro Inc sole Guyanese company to bid for oil block

…chairwoman optimistic of pioneering company’s chances

By Jarryl Bryan

Standing, from left; Executive Director and Chairwoman Dr Melissa Varswyk and Executive Director and THAG President Dee George. Sitting, from left; Executive Director Dr Ayodele Dalgety-Dean and Executive Director and Secretary Abbigale Loncke-Watson

Guyana’s historic oil blocks’ auction, which concluded last week, is notable not only for the plethora of international companies which participated but also for the lone Guyanese company which, through months of careful planning, was able to submit a bid for one of the 14 oil blocks.
The company, Sispro Incorporated, is based in Middle Street, Georgetown. It was formed within the last year and is being financed by New Hayven Merchant Bank, which was founded by local financial analyst Professor Floyd Haynes. Sispro Inc is making waves, not just because it’s an indigenous company wading in with industry giants, but because of its all-female Board of Executive Directors.
The Chairwoman of Sispro Inc is Dr Melissa Varswyk, the co-founder of Georgetown American University, who holds a Doctor of Medicine degree and a post-grad in Health Professions Education. Also at the helm of the company is Abbigale Loncke-Watson, who has founded several companies including MBW Energy Support Services and is behind the non-profit WeLead Caribbean.
Dr Ayodele Dalgety-Dean is another Executive Director and entrepreneur, who is the founder of Blossom Inc, an advocacy group against sexual and gender-based violence against children and women. The fourth and final Executive Director of this company is Dee George, an economics major who is also the General Manager of Herdmanston Lodge and President of the Tourism and Hospitality Association of Guyana (THAG).

In an exclusive interview with this publication, Dr Varswyk explained that Sispro was formed out of the desire of the four women to invest and capitalise on opportunities in the oil and gas sector, as a local company. It was important to them that the oil and gas wealth they would acquire from a successful bid and eventual production, remain in Guyana. But they are also pioneers in every sense of the word.
Out of all the companies involved in oil and gas exploration and production in Guyana, none are indigenous companies who are also operators of a block. Should Sispro be successful in the bid, they plan to partner with Exceed Torridon Limited, a Scottish firm that has operated on more than 60 wells in 39 countries, to explore for and produce oil. It is a historic venture and the bid round, which was first launched last year November and concluded last Thursday, was a critical step on their way to their goal.
“Since there not much women in oil and gas, we decided why not take the challenge and bid for a block, with the hope that we would have the opportunity to have the wealth trickle down in Guyana. And at the same time, bringing women at the forefront of oil and gas. We started exploring what is it that we need,” Varswyk explained.

Map showing the blocks that were up for auction

One of the major things the company lacked at the time of its start-up was the technical expertise specific to oil and gas. The company has since brought on Rotimi Ogunlowo, a Petroleum Engineering Consultant with 26 years under his belt working for an ExxonMobil affiliate company in Nigeria; Francis Bassey, a Geoscience Technical Executive with 35 years of experience in oil and gas and John Olaniyan, an experienced Petroleum Management professional who has worked in Chevron Nigeria and ExxonMobil.
Other professionals who were hired are Adebayo Okunlola, a Geoscientist with over 25 years of experience in Nigeria; Ebenezer Olufemi, an Operations and Maintenance Management executive experienced in pipeline and deepwater infrastructure maintenance; Candacie Brower-Thompson who worked as an Environmental Specialist with the local Environmental Protection Agency (EPA) for 16 years. With the exception of Brower-Thomspon, all of these specialists were recruited straight out of Houston, Texas, home of ExxonMobil.
Last but not least, former Digicel Guyana Chief Executive Officer (CEO) Gregory Dean has joined their team as their Financial Advisor. According to Varswyk, they recruited these specialists and were able to put together their team.

When the dust had settled from the oil block auction, a total of eight bids were received from six companies, including Sispro, for the 14 oil blocks. US oil major ExxonMobil, which is already producing oil offshore Guyana in the Stabroek Block, was one of those six oil companies that submitted bids for the blocks.
The other companies were Sispro Inc (Guyana); Total Energies EP Guyana BV; Qatar Energy International E&P LLC; Petronas E&P Overseas Ventures SDN BHD (Malaysia); Delcorp Inc Guyana and Watad Energy and Arabian Drillers of Saudi Arabia; Liberty Petroleum Corporation of the US and Ghana-based Cybele Energy Limited; International Group Investment Inc and Montego Energy SA (London).
Asked by this publication how confident she was of her company’s bid being successful, Dr Varswyk left no doubts of how optimistic they were. She was adamant that the company had met the oil block auction’s stringent requirements.
“We see it as a collective effort. We believe that we satisfy both the technical and financial criteria. We know that we have a strong environmental consultant on our team also, who actually worked with the EPA. So, she’s bringing on board all the know hows as it relates to the environmental aspect of oil and gas. She also helped in coining the regulations for Guyana.”
“And so, with that technical, financial and environmental capacity and, of course, my team’s strong relationship in the business sector already in Guyana, I believe we can make this happen,” Dr Varswyk explained.
Vice President Bharrat Jagdeo has previously stated that when the auction wrapped up, evaluations of the bids and negotiations with prospective companies would follow before the blocks could be awarded. He has also previously indicated that the Government hopes to wrap this process up by year-end. Companies will also be expected to abide by the fiscal terms in the new model Production Sharing Agreements (PSA), in order to attain and retain these blocks.
Under new conditions, Guyana stands to benefit from signature bonuses as high as US$20 million for the deep-water blocks and US$10 million for the shallow-water blocks. Additionally, all future PSAs will 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 10 per cent fixed rate; 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.
In the meantime, there is also the prospect of bilateral partnerships at the country-to-country level to develop Guyana’s remaining oil blocks. Among the countries that have expressed a willingness to work at a government-to-government level were India, Qatar and more recently, the Dominican Republic.