Problems with Oil Contract in Guatemala

The government is negotiating negotiate contractual issues with City Petén, concessionaire of the exploration and exploitation contract for oil area Petén 1-2008.

Friday, August 24, 2012

In order to complete the award process seven legal aspects that have been identified by the Ministry of Energy and Mines (MEM) must be corrected, said the head of the ministry, Erick Archila.

One of the concerns identified was that while the company is presented as a U.S. company, it is registered in Panama. Another refers to a clause stating that no new rules can be applied should laws change.

Prensalibre.com quoted minister Archila who said, "We have had delays in resolving legal schemes, and until we solve them they have to be patient, because there must be a favorable outcome for them. Once we reach such point, then we will sign. "

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More on this topic

Oil Contract Approved in Guatemala

August 2013

The government has awarded the company City Petén a contract for exploration and exploitation of oil in the Yalcanix area in the department of Petén.

Jose Paez, legal representative of City Peten, said they plan to start environmental impact studies and in the next three years will be investing $30 million during the exploration stage.

Offers by Oil Companies in Guatemala

February 2013

Nine companies have submitted 15 bids to the Ministry of Energy and Mines, in the tender for exploration and exploitation of seven oil fields.

Prensalibre.com reports that "The Cotzal area (Petén) received five applications; Laguna Blanca (Petén) and El Cedro (Alta Verapaz), three; San Francisco, two, and Cancuén (Petén) and Xalbal (Quiché) one, respectively. The area of La Libertad (Petén) did not receive any bids".

Guatemala Prepares Oil Tender

July 2012

The Ministry of Energy and Mines is continuing its search for companies interested in participating in a tender for the seven oil fields located in Petén.

Investors from Canada, the USA and Uruguay have participated in briefings and for in the next few weeks so will businessmen from Colombia and Brazil.

Uncertainty Over Oil Concession

May 2012

The change of government in Guatemala has delayed the ratification of a contract awarded to City Petén for oil drilling in an area with 140 million barrels.

On October 31st, 2011, at the end of the Colon administration, the Ministry of Energy and Mines signed a concession contract to exploit oil in the Yalcanix (PTN 1-2008) area with the Guatemalan company City Petén after a tender in which only two other companies, Perenco Guatemala and the aforementioned City Petén participated. The offer from Perenco was $11 million and City Petén’s was $30 million. Both companies have experience in oil exploration in the country.

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