The decision of the I Chamber to annul the judgment that prevented the signing of contracts without environmental studies has refloated the possibility of the contract with the American Mallon Oil Company being valid.
In the year 2000 the government of Costa Rica signed with US oil company Mallon Oil Company a contract to explore and develop natural gas and oil in six blocks of territory without the prior existence of an environmental impact study, an exception allowed by decree 26,750 of 1998.
After the expiration of the concession currently held by Perenco, a tender is to be launched for the operation of a pipeline connecting the Xan field in Peten with the oil terminal in Piedras Negras.
Elperiodico.com.gt reports that "...Vice President Jafeth Cabrera, after a meeting in Puerto Barrrios, Izabal, said the contract with Perenco which expires next year will be extended by no longer than six months in order to realise the tender."
The results of the examination carried out so far by the Norwegian company Statoil indicate the existence of "interesting geological structures that may contain oil."
Elnuevodiario.com.ni reports that "...Preliminary results of the first stage of research were presented on Tuesday by Statoil to authorities of the state-owned company Empresa Nicaragüense de Petroleos (Petronic), the Ministry of Energy and Mines (MEM), the Ministry of Environment and Natural Resources (Marena), and Enel."
The current national accounts methodology could be causing an underestimation of the value and potential of an industry that has become a success.
In his article in Ca-bi.com, Paulo de León objects to the failure to update the Guatemalan national accounts system, resulting in an underestimation of the weight of the sector in the Guatemalan economy, as that system does not incorporate the shift in the energy matrix towards renewable energy.
The decline in global prices is the main reason behind the abandonment of several areas on the part of concessionaires, added to which is confusion around the mining moratorium.
Guatemala went from extracting 9 million barrels of oil in 2003 (a daily average of 24 thousand barrels) to just 3 million in 2015 (10 thousand barrels per day), recording a drop in production of 59.4% in twelve years. Factors such as the rapid decline in oil prices, lack of implementation of contracts and lack of transparency continue to affect the competitiveness of companies interested in investing in exploration and exploitation.
Quattro Exploration and Production has made an agreement with GFI Petroleum Guatemala to acquire a license for the operation of block 6-2012 block, consisting of 34,723 hectares in the South Peten basin.
From the press release by QUATTRO Exploration and Production:
The state run oil company in Costa Rica registered losses above $24 million during the first nine months of 2015, despite having the highest prices in the region.
In the first nine months of 2015 the Costa Rican Oil Refinery lost more than $24 million. The state run company, which has had a monopoly in refining and sale of fuels in Costa Rica for more than half a century, has payroll costs representing 56% of its total expenditure.
The decline in international oil prices is already affecting companies that exploit the resource in the country, meanwhile, contracts awarded in 2014 have not yet been signed.
Authorities at the Ministry of Energy and Mines (MEM) and the companies that received concessions to explore and exploit oil in the country predict a significant decline in investment in the sector this year, due to the downward trend in oil prices in the international market. This year it is expected that three contracts that were awarded in 2014 will be signed, and also "... the possibility of an oil tender has arisen, for which several blocks in Alta Verapaz and Peten have been earmarked."
The government has announced that is planning to resume preliminary exploration activities in the Caribbean by the end of the year.
The National Energy Secretary Victor Urrutia, said that the purpose is to learn more about alleged existing deposits in the area in order to determine if indeed they exist and if there are sufficient amounts to justify extracting them.
At the end of August 2015 production was 2.4 million barrels, 2.5% less than in the same month in 2014, mainly because of lower investment on the part of operators.
Low international oil prices are the main reason that companies drilling and extracting oil in the country have reduced their investments and therefore their production, taking advantage of the situation to carry out maintenance work in the fields.
After the signing of a contract between the government of Nicaragua and a norwegian company to explore for hydrocarbons, Costa Rica has noted that the award was made on disputed maritime areas in the International Court of Justice.
An article in Nacion.com reports that "... Foreign Minister Manuel Gonzalez said he prepared the letter to the company that received the rights to explore and exploit hydrocarbons in the Pacific coast, in an area that lacks clear boundaries between the Costa Rican and Nicaraguan territory."
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