The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

THE Government was yesterday said to giving "active consideration" to the renewal of an oil driller's licence and the wider issue of exploration in Bahamian waters.

Romauld Ferreira, minister of the environment and housing, told Tribune Business that the renewal of Bahamas Petroleum Company's (BPC) licence was "on the radar" with the issue set to be put before the Minnis Cabinet "imminently".

BPC's existing licence to spud its first exploratory well near the maritime border with Cuba expires this month (April 2018), having been extended for a year by the outgoing Christie administration before it was out of office. The exploration firm has so far been frustrated in its bid to drill a well south-west of Andros by the lengthy search for a 'farm-in' (joint venture) partner to share the financial and technical burden, with the process having taken longer than expected due to the global oil price fall and subsequent industry pull-back on exploration activities.

BPC thus requires another licence extension from the Government to continue its activities, and Mr Ferreira told Tribune Business: "All of that is under active consideration. "We maintain good relations with the company. There are some things in relation to oil exploration that are going to be before Cabinet for consideration, and it would be inappropriate for me to speak to them before Cabinet considers them."

Pressed by Tribune Business, Mr Ferreira added of BPC's licence and oil exploration: "It's on the radar and I would say it's very imminent. We understand these are time sensitive issues and it's important.

"We're working on it. My Ministry is working on it, and we will submit something for Cabinet's consideration and take it from there."

Simon Potter, BPC's chief executive, told Tribune Business by e-mail: "We welcome any and all 'active consideration' by the Government." Contacted by phone yesterday, he declined to comment further, but this newspaper understands that a Government decision could be forthcoming before month's end and the company is hopeful for a positive outcome.

Carl Bethel QC, the Attorney General, recently thrust oil exploration in Bahamian waters back into the spotlight when he told the Senate that the Bahamas only had a two-decade 'window of opportunity' before oil is no longer profitable.

Suggesting that the Bahamas could not ignore the possibilities for economic diversification, he said: "Where will we find future foreign currency earnings to make up for the losses being incurred in our second economic pillar?

"Can tourism alone bring in the kinds of foreign currency inflows needed in an economy which has to import the vast majority of its most basic needs, and to pay for such necessities in US dollars?

"Well, we know that we have to make a decision sometime in the near future on the Bahamas Petroleum Company and its proposal to drill for oil in the area just off the southernmost part of the Great Bahama Bank. "The hard decision may have to be taken," Mr Bethel added.

"With the rapid development of renewable alternative energy sources, we may have no more than a 15-25 year window in which to profitably extract any such resources."

While environmental activists and others are opposed to oil exploration in Bahamian waters, due to the potentially negative impacts on the environment, tourism and economy should a spill occur, the potential benefits for a Government struggling with a $7.5 billion-plus national debt are likely to be too strong to ignore.

The former Christie administration passed into law a regulatory framework to govern oil exploration, as well as creating a sovereign wealth fund to handle any royalties and other proceeds from its discovery. It also shelved any referendum on whether to permit oil drilling in Bahamian waters until after there was confirmation that such deposits exist.