LION ZION DREAMS OF CRUDE
Better known for its reggae, world-class track runners, and beautiful sandy beaches, Jamaica might be holding other kinds of riches in its subsoil.
Since 2014, British oil and gas company Tullow Oil has been exploring the country's offshore territory in search for hydrocarbon reserves and seems closer than ever to striking black gold. After Tullow Oil found a live oil stream in its Walton Morant license in early 2017, the company has undergone a subsequent 667km 2D-seismic survey of the area, which yielded promising results. A further 2,200sqm 3D-seismic survey was swiftly planned and undertaken. In early 2018, the Polarcus Adira vessel surveyed Jamaican waters for 45 days in what was the most advanced ever study made in offshore Jamaica, in a block license that covers water depths ranging between 25-2,000m.
The study came to term in May 2018 and focused on de-risking previously identified potential cretaceous and tertiary reservoir targets for drilling. These include a number of different targets across the Walton and the Morant basins, but particularly the Colibri target, which has been estimated to hold prospective resources of over 200 million barrels of oil equivalent. Colibri is where most of the Jamaican hopes for finding oil lie at the moment. Besides the promising data identified in the 2D seismic study, the quality of the rockbed in the area and the oil seeps identified on the water surface further reinforce the target's potential.
The focus now is on waiting for the 3D seismic final results for the company to take a decision on whether or not to drill, which should take between 12-18 months. However, United Oil and Gas, a partner in the project, announced in August that a fast-tracked version of the study's results had identified a potential exploration prospect, which further reinforces the possibility that a decision to invest in drilling in Jamaican waters might follow. A decision on the next move is not expected until 2020, however.
In early 2018, United Oil and Gas farmed-in on Tullow's license and now owns a non-operating 20% stake in the asset. These are encouraging developments for Jamaica, which remains a largely unexplored frontier market. In total, both onshore and offshore included, there were only 11 wells drilled in the country so far, and while there have been no significant oil or gas discoveries, 10 of these wells have had oil or gas shows, which has helped leaders maintain hope in the country's oil future. The government and the Petroleum Corporation of Jamaica (PCJ) are confident the USD60 million so far invested in surveying the country's waters will pay off. PCJ has directly collaborated with Tullow in the 3D seismic survey and helped bring local communities and stakeholders on board. Representatives from key entities including the Fisheries Division, the British High Commission, JAMPRO, Jamaica Fisheries Cooperative Union, the National Environment and Planning Agency (NEPA), Environmental Solutions Limited, the University of Technology, Jamaica, the Port Authority, and Polarcus have met with Tullow and the PCJ in preparation for the survey in an attempt to provide information, clarify any issues that might affect the work of the British company, and fend off any kind of conflict.
Furthermore, PCJ and CGG GeoConsulting published a study on an onshore prospect area that revealed two live oil seeps, each 70km apart, which indicate potential for active oil systems and reservoirs in the country's onshore areas as well. So far, Tullow is the only company actively searching for oil and gas in Jamaica, but that might not last long. In recent months, there has been growing interest for oil exploration in Caribbean countries, including Guyana, Grenada, the Bahamas, Barbados, and Suriname, in the hopes of mimicking the successes achieved in oil and gas-rich Trinidad and Tobago. A more concrete proof of success by Tullow in Jamaican waters will surely bring an influx of interest by oil and gas companies to explore the country. Tullow might not be one of the biggest oil companies around, but its reputation precedes it as a world-class frontier market oil and gas explorer, most notably after the company's success in both finding and developing the great Jubilee field in Ghana.
LION ZION DREAMS OF CRUDE
TABLE OF CONTENTS
Interview
Michael Lee-Chin, Founder and Chairman, Portland Holdings, Chairman, Economic Growth Council, Chairman, National Commercial Bank (NCB)
Portland Holdings manages public and private equity and strives to build strong businesses that support the well-being of the communities in which they operate.
read articleCommuniqué
A Legal Introduction to Jamaica’s SEZ Regime
A special economic zone (SEZ) is as a geographical demarcated area within a country's national borders that is governed by trade and business laws that are distinct from the laws of the rest of that country. The objective of an SEZ is usually to attract investment to a nation's shores, and thereby increase employment and economic growth.
read articleInterview
Daryl Vaz, Minister with responsibility for Land, the Environment, Climate Change, and Investment, Ministry of Economic Growth and Job Creation
The Ministry of Economic Growth and Job Creation is working hard to ensure Jamaica's growth doesn't come at the expense of its environment.
read articleFocus: Brain drain
Holding on to the Best
Given its close proximity to North America's economic powerhouses and its warm relationship with its former colonial power, Jamaica's best and brightest have long decamped for more developed shores. The government is now fighting to encourage them to stay at home.
read article
