Government’s quest to find commercially-viable oil and natural gas resources offshore Barbados has caught the international oil industry’s attention.
The Ministry of Energy, Business Development and Commerce has disclosed that when the three-month period for parties to pre-qualify ahead of negotiating exploration licences ended on September 1, there were six applicants.
The submissions were made between June 2 and September 1 in line with the Barbados 2026 Offshore Direct Negotiations process launched on June 1.
An update from the ministry announced that the first application made on June 2 had their qualification status approved and has reserved three blocks – Flying Fish (2 763 square kilometres), Manjak (1 336 sq km) and Oistins (2 491 sq km) – for exclusive negotiations.
The other five submissions are under review and hence none of the remaining blocks has been reserved for exclusive negotiations. There are an overall 19 blocks available for licensing comprising 62 643 square kilometres.
Minister of Energy, Business Development and Commerce Kerrie Symmonds said yesterday that some matters material to the initiative were now before Cabinet and indicated that after these deliberations were completed, he would provide an update.
The ministry’s announcement about the pre-qualification applications process stated that “the names of the parties that have submitted qualification applications will remain confidential and will only be published pursuant to a successful award.
“For companies whose applications for qualification as an operator remain under review, no blocks will be reserved pending the determination of those applications,” the ministry explained.
“Following the issuance of a qualification notice, priority in respect of any block will be determined in accordance with Section 3.2 of the Guidelines for Direct Negotiations 2026, based on the date and time of receipt of the complete cover letter submission required under section 3.1.1.”
The ministry also said that Government was in the process of finalising amendments to the offshore petroleum laws. These comprise the Offshore Petroleum Act Cap. 282A, the Offshore Petroleum (Taxation) Act Cap. 80 and the Offshore Petroleum Regulations 2013/111 and any subsequent amendments.
“These amendments will facilitate the efficient conduct of direct negotiations,” it noted.
When Symmonds and director of the Ministry of Energy’s Natural Resources Unit James White announced the pre-qualification applications process in June, they said the findings of seismic surveys suggested there was potentially 13 billion barrels of oil and more than 40 trillion cubic feet of natural gas offshore Barbados.
“What we are trying to do is to find companies who will work with us on the basis of a few important criteria. First, they have to be able to do drilling and exploration in ultra-deep water. Secondly, we want to be able to have companies that have the technical experience with regard to the cleaner aspects of exploration,” Symmonds said on that occasion.
As oil companies eventually search for oil and natural gas in Barbados’ waters, Government has said it will be participating in the exploration up to a maximum of ten per cent, 15 per cent or 20 per cent in various bid blocks.
Guidelines available
Under the guidelines available to interested parties, the Ministry of Energy said the State “will have the option to assume all or part of its interests in a production licence as of start-up of production”.
“The State will be carried through to first production and assume full responsibility for future work under the production licence proportional to this interest. Exploration costs, excluding dry hole costs, will be reimbursed out of the state’s share in production at no more than 25 per cent of net income per year,” the ministry detailed.
The guideline also said that direct negotiations with Government “may commence directly after the issue of a qualification notice [and] negotiations will be conducted on an exclusive basis and are projected to be completed within a period of three months”.
Key areas to be covered during direct negotiations involve applicants making commitments on several financial matters, including a minimum annual training fee of $200 000, and a minimum $100 000 annual coastal and marine environment research fee.
“Negotiations will consider the robustness and appropriateness of the proposed local content commitments and provisions, including the procurement of local goods and services for use in respect of petroleum operations, the employment of local persons, and the transfer of technology and skills,” the guidelines stated.
“Negotiating parties are required to prepare and submit a health and safety plan in respect of the petroleum operations to be conducted in the block. The negotiating party shall ensure that the health and safety plan is based on the health and safety management system of the party.”
Government’s negotiations with oil industry players will also “consider the relative strength of the work programmes, with particular emphasis on the programme’s appropriateness for evaluating hydrocarbon prospectivity and facilitating exploratory drilling during the relevant phases of operation.
“The work programme should specify the geological, geophysical and other data to be acquired, compiled and assessed. The party should undertake a comprehensive technical assessment, including an evaluation of the geology, structural evolution, stratigraphy and the petroleum prospectivity of the area,” the Ministry of Energy outlined. (SC)
