No drilling before regulations in place
The Bahamas Petroleum Company (BPC) will not be permitted to drill any exploratory wells in Bahamian waters until the regulations that will oversee the industry are completed.
According to Minister of the Environment and Housing Kenred Dorsett, these regulations will not be completed before the end of the year.
“You won’t see exploratory oil drills this year, that’s for sure,” he confirmed.
Last week, Simon Potter, BPC’s chief executive officer, revealed that the government has renewed the company’s five exploration licenses for another three years.
However, as part of its conditions for renewal, Dorsett said his ministry imposed new requirements that would ensure that no drilling would take place until the new regulations are in place.
“BPC’s license has been renewed. Under the license that they had, they indicated that renewal would be automatic once they applied for it and met a certain condition,” he said.
“Those conditions have been met but in addition to that, the government has imposed new requirements, which ensure that there will be no drilling whatsoever being able to be advanced until the new regulations are put in place.”
“We have indicated to them that while the license is renewed, it will also be subjected to a new environmental regulation that we intend to advance.”
Dorsett noted that his ministry is working with the attorney general’s office on the new regulations that will include a new legislative framework relating to oil exploration and drilling.
“As we indicated before, we are not only looking at the new legislative regime or petroleum exploration, but we are also looking to enhance the environmental aspects associated with that endeavor,” said Dorsett.
“So they will be subjected to those environmental regulations, which we are currently working on with the attorney general’s office.
“BPC has given us a timeframe for the end of this calendar year and so we are working assiduously to attempt to have it completed before then.”
In a recent interview with Guardian Business, Potter revealed that these license renewals now give the company the “authority” to drill a well and establish commercial reserves by 2015.
“The government has renewed our licenses for three years. That says to us by April 2015, you are to have drilled a well here in The Bahamas,” he said.
“This gives us the authority to go ahead and drill our well and try to establish those commercial reserves by 2015.”
Potter estimates the company will begin its oil drilling program in the latter part of 2014.
BPC was granted five oil exploration licenses in April 2007.
To date, BPC has invested $50 million in the country, with most of that spent on 3D seismic testing, and has completed its environmental impact assessment (EIA). Now, the company is working on its environmental management plan (EMP) to meet its 2015 obligation to the government.