The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas Petroleum Company’s (BPC) incoming chief executive yesterday said it was “our right to extend” the company’s four oil exploration licences beyond their end-June 2021 expiration.

Eytan Uliel, in a podcast responding to investors’ queries, asserted that the oil explorer’s renewal bid was “not so much an application because we have the right to” extend the licences for another three-year period.

Confirming that BPC, which is soon to be renamed as Challenger Energy Group, has submitted the necessary documentation to the government to start the renewal process, Mr Uliel said: “We were required to submit the application to extend the licence.

“It’s not so much an application, because we have the right to... It’s our right to extend it, we have submitted all the paperwork required. It was required three months before June 30. That’s now been submitted to and there’s a process we go through in terms of renewal, but that’s all in train.”

It was unclear whether Mr Uliel, who is stepping up from his previous post as BPC’s commercial director to replace Simon Potter as chief executive, meant that BPC has an automatic right to apply for a licence covering a third exploration period after the company fulfilled its commitment to safely drill its Perseverance One exploratory well.

However, his comments will likely trigger alarm among environmental activists and other opponents of oil exploration in Bahamian waters, who may interpret them as meaning that BPC will automatically gain a licence renewal/extension having met its previous obligations.

They will also put further pressure on the Minnis administration, given that the Prime Minister and his minister of the environment, Romauld Ferreira, have both stated their personal opposition to offshore oil drilling, to deliver on their public pledges.

Mr Uliel, meanwhile, confirmed that BPC will be looking to a joint venture, or farm-in, partner to take on the bulk of the costs and technical work associated with drilling a second exploratory well in Bahamian territorial waters should its licence renewal be successful.

He declined to provide details on the farm-in search apart from saying that BPC has “been in contact with a wide range” of potential partners, and that a “data room” has been set up to allow such companies to conduct due diligence on the information gleaned from the company’s efforts in The Bahamas to-date.

“The results of Perseverance One, while not resulting in a commercial discovery at that location, do point to a deeper Jurassic play and I think it needs to be tested in a subsequent exploratory well,” Mr Uliel said. “This will inevitable be a more expensive well than Perseverance One.....”

As a result, he added that BPC would want any joint venture partner to take the lead and do the bulk of the “preparation for that well and to pick up the costs of that well”.

And the incoming BPC chief revealed that the oil explorer will provide its “technical report” on Perseverance One’s findings within the next two months. “We’re currently doing all the final work,” Mr Uliel said. 

“We’re then obliged to provide a technical report to the Government of The Bahamas first. Once we do that, we intend to publish the highlights of that report and I estimate that will be about six to eight weeks from now.”

Mr Uliel’s comments came as the environmental activists behind the Judicial Review challenge to BPC’s permits and approvals yesterday released a letter sent to UK prime minister, Boris Johnson, and Commonwealth secretary-general, Baroness Scotland, seeking their help to halt oil exploration in The Bahamas.

The Our Islands, Our Future Coalition urged: “We respectfully write to request your urgent assistance in protecting the sensitive and irreplaceable waters of The Bahamas, and to help us prevent a dangerous, ill-conceived offshore oil drilling project that would fuel global climate chaos for decades.....

“As you know, The Bahamas is an island nation which faces some of the most immediate and severe impacts of sea level rise, ocean acidification, coral bleaching and intensifying super storms fuelled by the climate crisis.

“The active oil drilling project in The Bahamas today puts our entire nation, and indeed our entire economy, at risk. The Bahamian economy is inextricably tied to the sea. More than 50 percent of our country’s GDP comes from tourism and fishing. Our national treasure is, in fact, the allure of our pristine waters and the potential for sustainable ecotourism as we rebuild from the dual impacts of Hurricane Dorian and COVID-19.”

Whether Mr Johnson and Baroness Scotland would intervene in The Bahamas’ sovereign affairs as requested is uncertain, and BPC’s project is unlikely to “fuel global climate change” by itself.

Nevertheless, the coalition said: “We seek The Commonwealth’s counsel and hope it will exert any influence it has to assist The Bahamas in transitioning to a clean-energy future. We hope that the Secretariat and all member countries will stand in solidarity with the thousands of Bahamians and global citizens to impress upon our national government that sound climate policy is incompatible with unleashing a new crude oil reserve of up to 1.4bn barrels on the global climate.

“The Bahamas is not prepared to respond to an oil spill disaster. The Bahamas is not an oil-producing nation and our government is neither equipped to regulate this industry nor respond to a disaster. We do not have the equipment or expertise to mount a response.

“We would be completely dependent on the goodwill of our neighbours and the responsiveness of the oil company that seeks to risk our economic, cultural and food security on a money-making scheme for foreign investors.”

The letter, signed by Casuarina McKinney-Lambert, executive director of the Bahamas Reef Environment Education Foundation (BREEF), and Rashema Ingraham, of Waterkeepers Bahamas, added: “Urgent action is needed as the oil drilling leases are up for renewal at the end of June 2021.

“As with many fossil fuel exploration efforts in the history of the Commonwealth, the deals struck many years ago between the Bahamas Petroleum Company (registered in the Isle of Man) and the Government of The Bahamas, severely lack in transparency and accountability to the citizens of The Bahamas.

“As such, we request that The Commonwealth invoke its successful record of promoting good governance and transparency among member nations in assisting the Government of The Bahamas to align their public statements opposing oil drilling (our Prime Minister has repeatedly stated that he is totally against oil drilling)n with action against oil drilling. We simply cannot allow an investor-driven company to run rough-shod over the best interests of the Bahamian people.”