Guatemala initiates exploration bidding for 12 area's soon

Jan 22, 1997 01:00 AM

Guatemala's Energy and Mines Ministry will initiate an international bidding process for oil and natural gas exploration and exploitation in 12 areas in the next four months. The Ministry will accept bids on two areas from March 11-14 and bids on the other 10 areas May 13-16. The government hopes to announce the results by mid-June. In five of the 12 areas, the ministry will grant contracts for crude exploration with a production option. Two of the areas up for bids are explored previously and have proven oil reserves. Under the government's "shared production" rules, once a company has earned back its investment, it must share profits with the government according to an established table of percentages. One of the areas for shared production is 185,093 acres in the Lake Izabal area near Guatemala's Atlantic coast, which has 80 million barrels of proven reserves, the Ministry said. Shell Oil previously explored this area for offshore drilling. The other area being offered for a shared productioncontract is 70,885 acres on the Mexican border, with proven reserves of 45 million barrels. Two other zones being offered are ready for production after re-entering previously drilled wells. Three of the 12 areas, including one off of Guatemala's Pacific coast, are for natural gas exploration. Many of the areas open for exploration are in remote, jungle-covered parts of Guatemala's Peten province. The Ministry said oil companies will be able to construct pipelines along the same rights-of-way used by Basic Petroleum International Ltd which has constructed pipelines to the seven fields where it produces oil here.
Guatemala's crude oil production, all extracted by Basic Petroleum, is currently 22,000 bpd, up from 12,000 bpd a year ago.

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