JIS News

After a 20-year hiatus, Jamaica has renewed efforts to identify oil and gas deposits, with seismic testing to begin off the island’s south coast as of today (Feb.10).
Furgo Limited, a Norwegian-based geosciences company, has been contracted to undertake the seismic work by licensee, Finder Exploration of Perth, Australia. Commerce, Science and Technology Minister, Phillip Paulwell, who made the announcement at a press briefing held at the Jamaica Pegasus hotel on Wednesday (Feb. 9), said that the survey would last for approximately 10 weeks and would entail the acquisition of seismic geophysical data on four blocks -seven, ten, 11 and 12.
He said the operations, which will be restricted to a 10 kilometre-radius from Pedro Cays, would be conducted on a 24-hour a day basis. The testing vessel, Akademic Shatskiy, will be accompanied by a scouting vessel.
Minister Paulwell said that the data collected would be processed at one of Fugro’s processing centres in Houston, Texas (USA) or Perth, Australia, after which the information would be made available to the licensee. The processed data, which will determine the prospects for oil and gas exploration on the four blocks, should be available six to seven months after the survey period.
The Commerce and Science Minister assured that everything was being done to ensure the preservation of the environment and the livelihood of fisher folk in the area being explored, informing that permission has been granted by the National Environmental Planning Agency (NEPA) for the survey.
He noted also, that stakeholders such as the Fisheries Division, the Fisheries Cooperative and the Jamaica National Heritage Trust have been informed of the work to be carried out.
Minister Paulwell pointed out, that the exercise would be of no financial cost to the country. “We do not intend to invest in the project, in fact, it will not cost the country a single cent. We are seeing investors, who are prepared to come forward .and pay their money up front,” he said.
In the meantime, he said negotiations were ongoing with other companies that had submitted tenders for exploration, during the formal bidding round, but had not entered the bidding process. Minister Paulwell said the government has decided to allow the Petroleum Corporation of Jamaica (PCJ) to enter into direct negotiations with these companies.
Meanwhile, vessel operations manager of Fugro, Dag Sigurd Stensholt, said that meetings have been held with fisher folk in the Pedro Cays and Whitehouse areas. In addition, he said there were restrictions on the areas within which the geophysicists could work, to protect the environment.
The exploration is being conducted under a production sharing arrangement whereby the licensee pays a 12.5 per cent royalty to the government, either in cash or kind, and then splits the oil and gas produced with the PCJ. The split will be based on the volume of oil or gas produced as well as the depth of water in which production takes place.
Jamaica has conducted five seismic surveys since the 1950s, which resulted in the drilling of two wells. While neither of the two wells yielded gas or oil in commercial quantities, it is hoped that the new data will identify better prospective sites that will warrant drilling.
Cabinet on November 15, 2004 approved the arrangements for the Jamaican Government through the Petroleum Corporation of Jamaica to initiate a round of petroleum exploration within Jamaica’s Exclusive Economic Zone (“EEZ”).
Approval was given for the initiation of a round of oil exploration contracts for 22 offshore blocks and four onshore blocks earmarked on the plan developed by the PCJ. It was intended that the blocks would be assigned to explorers on a competitive bidding or “first come first served basis”.