Countries barbados Getting to grips with the offshore again Andre Braithwaite (courtesy Andre Braithwaite) The high point of energy activity in Barbados in <strong>2013</strong> will almost certainly be the signing of exploration and production (E&P) contracts with the Anglo-Australian explorer/ producer BHP Billiton, for two blocks in deep water acreage southeast of the island. The blocks adjoin each other, Carlisle Bay (2,498 sq km) directly to the north of Bimshire (2,506 sq km). These two pieces of exploratory acreage were first offered for auction in Barbados’s ill-fated 2007 bid round. But it is probably better late than never for Barbados, which is anxious for offshore exploration to be resumed in earnest. There has been no activity offshore since November 2001, when what is now ConocoPhillips drilled the unsuccessful US$35 million Sandy Lane 1 well in 6,500 feet of water. Barbados’s minuscule 900 b/d of oil is derived from onshore fields, worked by the Barbados National Oil Company (BNOC). Around 2 million cubic feet (mmcfd) of associated gas is used in the fields or sold to the sole electricity provider, Barbados Light and Power. Barbados is the only Caricom oil producer to have stuck with the E&P agreement model for offshore. All others have preferred productionsharing contracts, first introduced in 1993 by Trinidad and Tobago (which still uses E&P agreements for onshore activity). Barbados’s position has always been that E&P contracts are better suited for a country at its stage of hydrocarbon development wanting to attract explorationists. The work programme agreed with BHP Billiton has not been formally announced, but is almost certain to include 3D seismic and one or two exploratory wells, once prospectivity is revealed. A carried share for BNOC – at least in the exploration phase – was a biddable item in the block auction and could be as much as 25%. BNOC is excited at going offshore for the first time on the back of a major international oil company. General manager Winton O’D. Gibbs told this YEARBOOK that “we will take up any stake with enthusiasm. We know offshore is expensive, but the rewards are much better.” BHP Billiton presumably sees opportunities in the Barbados offshore, despite ConocoPhillips’ disappointing experience, or it would not have persevered as long as it has. It has had to overcome various negotiating obstacles along the way, including a change of government in early 2008. Perhaps fortunately for the company, the Democratic Labour Party retained power in the general election in February <strong>2013</strong>, though with a severely reduced majority. ConocoPhillips’ failure to find commercial quantities of oil has not dampened the experts’ positive view of the Barbados deep water either. Mervyn Gordon, BNOC’s technical manager, believes that “both oil and gas will be found off Barbados, not just gas, as some people have said. Drilling will be taking place in about 6,000-7,000 feet of water and you can go another 10,000- 15,000 feet. I expect we will find some oil. I am very confident of that.” Andre Brathwaite, director, natural resources, in the division of energy and telecommunications in the office of prime minister Freundel Stuart, believes that “a discovery of oil or gas will be made offshore Barbados in the years ahead. I base that confidence on the geology.” He points out that “the more than <strong>14</strong>,000 lines of offshore seismic we now have shows that we have prospectivity in the east, west and south,” and cites extensive seismic coverage as one of the reasons why “international companies are now showing interest in Barbados again.” Onshore, BNOC will be continuing its development drilling programmes in <strong>2013</strong>, following the exploration and appraisal wells it sunk in 2011-2012, which added at least 64,000 barrels to proven reserves. Development drilling is important not only because it maintains or increases production, but also because it often leads to an upgrade of reserves. The 2011-2012 programme added 822,000 barrels, according to Gibbs. 30
Barbados Block Map (courtesy Barbados Division of Energy) energycaribbean YEARBOOK <strong>2013</strong>/<strong>14</strong> 31