Prime Minister Freundel Stuart, who piloted debate on the Offshore Petroleum (Amendment) Bill, 2012 in the House of Assembly today, said he expected the legislative changes, including allowing interested entities to negotiate directly with government from the outset, to expedite offshore oil exploration starting with Australian company BHP Billiton.
That company was awarded the Bimshire and Carlisle Bay blocks.
“We confidently expect that once the amended legislation has been enacted, and it’s BHP Billiton with which we have been talking among others, that the preparation of the relevant licence can be completed by early in the year 2013,” the St. Michael South MP said.
“Hence the importance of our coming to the House today to pilot this amending bill through…”
Stuart said the purpose of the amendments was to “make Barbados a more attractive jurisdiction for potential investors in our offshore petroleum sector”.
“We are optimistic about this sector because seismic data suggests that there are some pronounced geological similarities between the sector in Trinidad and Tobago and what is being seen in Barbados’ offshore and these geological similarities give potential investors the optimism that they would be very well placed if they decided to invest in Barbados’ offshore petroleum sector,” he stated.
The Prime Minister said during discussions with “interested companies” Barbadian officials “discovered that there were areas of the legislation that would need revisiting so that the jurisdiction could be made more attractive and so that the provisions of the legislation could be more practicable for both Barbados as a jurisdiction and for potential investments in this sector”.
“In discussion with potential investors the point was very strongly made that if we have a call for tenders we do not also need a call for negotiations and … that potential investors should be able to conduct negotiations with Barbados directly,” he noted.
“So that the proposal is that potential investors should be able to enter into direct negotiations with Barbados rather than have to wait on an invitation to be called to negotiate. This of course would allow Barbados to deal with potential investors, who are qualified, on a first come first serve basis, and accelerate the process of making decisions in this important sector.
Stuart also said the legislation would make the lives of investors easier, and “the transition from an exploratory licence to a production licence should be seamless, should be almost automatic and therefore we propose to amend the legislation to amend that area of uncertainty”.
“The reality is that it is having a deterrent effect and the Government has determined to remove it,” he added.
Stuart said the “net effect” of today’s amendments “would be to make Barbados a more attractive jurisdiction for investment in this very important sector”. (SC)