Petroleum contracts in Guatemala extended for 15 years

Congress approved the Fonpetrol Law which establishes a new distribution of the royalties for the extraction of crude oil and allows for the extension, for up to 15 years, of current petroleum contracts.

Wednesday, November 19, 2008

The law established a 5% royalty on petroleum to be distributed among all the Departmental Development Councils; 20% will go to the departmental councils which have petroleum operations. 3 percent will be used for environmental protection.

At the same time it creates the possibility to extend the contracts for up to 15 years.

More on this topic

Extension of Oil Contract in Guatemala

December 2013

Petro Energy Company has the right to carry out oil exploration activities for 15 years.

"The term of the initial contract was for 25 years, and the company requested an extension, and the new expiration date is in December 2028 ... ", reported The measure passed by the Guatemalan government was based on the Hydrocarbons Law and the Law of Fonpetrol which states that the term for oil contracts may be extended once by up to 15 years.

"Petrolera del Istmo" Operates Rubelsalto Oil Area

August 2009

Starting yesterday, and for the next 15 years, the company will operate the oil fields located in Rubelsalto, Guatemala.

Carlos Parra, manager of "Empresa Petrolera del Istmo" (EPI), stated that his company foresees a 20% increase in output, reaching 900 daily barrels.

He added that next year they will invest almost $4 million in seismic, magnetic resonance and environmental studies.

Ministers Question the Legality of the Perenco Expansion

July 2010

The Guatemalan Environment, Culture and Sports, and Interior Ministers have suggested that the law was broken in extending the Perenco oil exploitation contract.

According to Luis Ferraté, Environment Minister, by expanding the scope of the project the extension violates laws regulating hydrocarbon exploitation, in which "only contract extensions are authorized, not modifications or expansions, as stated in the contract signed by the Minster for Energy and Mines (MEM) with Perenco".

Guatemala to put petroleum contract to tender

February 2009

The current exploitation contract with Perenco Guatemala will be extended for a maximum of 9 months, while the new tender is prepared. reports on its website: "The Minister of Energy and Mining (MEM) will extend the Contract for Emergency Petroleum Services next week, for up to nine months. This has been entered into with Perenco Guatemala Inc. since 2005. The company administers the areas known as 1.85.

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