TIDMBPC
RNS Number : 9137U
Bahamas Petroleum Company PLC
28 November 2019
28 November 2019
Bahamas Petroleum Company plc
("Bahamas Petroleum" or the "Company")
In-Country Update: Bahamian Mutual Fund Initiative
and Environmental Authorisation Progress Update
Bahamas Petroleum Company, the oil and gas exploration company
with significant prospective resources in licences in The
Commonwealth of The Bahamas, is pleased to provide details of
several important in-country developments, as the Company continues
its coordinated work effort toward drilling of an exploration well
in The Bahamas in 2020.
Highlights
-- Process initiated seeking to provide Bahamians with an
opportunity to invest in the Company's nationally significant
project, via creation of a Bahamian-domiciled mutual fund that will
exclusively hold BPC shares
-- Environmental Authorisation process and data collection
proceeding to schedule, consistent with drilling timetable;
Environmental Baseline Survey commenced, following timely receipt
of necessary permits from Government of The Bahamas
Bahamian Mutual Fund Initiative
With BPC's sole focus being to explore for, and thereafter
commercialise, Bahamian hydrocarbon resources, it has long been the
Company's stated objective to ensure, if possible, that the people
of the Bahamas have an equal opportunity to participate in the
ownership of the project, through the ability to invest in the
Company.
Following implementation by the Government of The Bahamas of
updated operations, safety and environmental laws and regulations
(in 2016) specific to the offshore industry, their clarification of
the Company's licence term (in February 2019) and the consequent
progress being made by the Company towards commencing exploration
drilling in late Q1 2020, the Company considers that it is now an
opportune time to revisit the matter of providing local Bahamian
investors with a means to invest in the Company.
In conjunction with its advisors, the Company will be seeking to
develop and implement a Bahamas-domiciled mutual fund investment
vehicle with the sole mandate of owning BPC shares. Thus it is
intended that through this mutual fund, Bahamians will be able to
invest in the Company and thus in the exploration and potential
development of hydrocarbon resources in The Bahamas. To this end
the Company has engaged Leno Corporate Services Limited ("Leno"), a
Bahamian investment services and fund management firm, to act as
its adviser for this purpose.
The Company expects that, following a further process of
consultation with Leno and various administrators in The Bahamas,
details of the proposed mutual fund, including the terms, how
investors' interests in BPC would be reflected, eligibility for,
anticipated timeframe and manner of subscription, will be confirmed
in the coming weeks.
Environmental Authorisation Progress Update
A. Background
In 2012, in accordance with the requirements under then
prevailing laws in The Bahamas, BPC completed an Environmental
Impact Assessment ("EIA"), which was reviewed and accepted on
behalf of the Government of The Bahamas ("Government") by the
Bahamas Environment, Science and Technology ("BEST") Commission.
Since then, the EIA document has been a public domain document open
to public scrutiny and comment (via both the BEST and BPC
websites). The Company has also undertaken extensive community
consultation and made numerous public presentations to communities,
stakeholders and public bodies throughout The Bahamas (New
Providence and the Family Islands).
In 2016, new laws and regulations pertaining solely to the
petroleum industry and more specifically to offshore exploration
and production were adopted in The Bahamas, with the effect of
modernising and strengthening legislative oversight in areas of
safety and environmental compliance. These new laws and regulations
introduced for the first time in The Bahamas an entirely new
concept of Environmental Authorisation ("EA"), as a required
mandatory step before commencement of drilling activities. In April
2018, BPC submitted an EA application in compliance with this new
regulatory requirement. BPC's EA application included, inter alia,
an updated EIA (to that already accepted in 2012) and an
Environmental Management Plan ("EMP").
B. EA - Current Status
BPC's EA application, including the updated EIA and EMP, was
reviewed by energy consultants Black & Veatch ("B&V") as
external consultant advisers to BEST Commission. B&V's
methodology and mode of analysis consisted primarily of a "gap
analysis", in which B&V sought to identify any gaps in the EA
documentation provided by BPC against any applicable laws,
regulations and applied international standards.
Subsequently, the Company appointed Acorn International
("Acorn"), a leading international environmental adviser, to work
with the Company and liaise with B&V / BEST Commission in
finalising the relevant EA documentation so as to address any gaps
as identified by B&V.
A major part of the work being undertaken by Acorn pertains to
incorporating into the EA documentation detailed data unique and
specific to the actual rig, that will undertake the planned
drilling activity. Substantial elements of the document submitted
in April 2018 contained, of necessity, only generalised data of a
"hypothetical rig" that could be utilised to carry out the drilling
operations. However, now that BPC is working with Seadrill,
specific data from the rig that will be mobilised to the field is
available and can be included as part of the application update.
This data includes, in particular, technical details, equipment
lists, standard operating procedures, and response plans specific
to that rig.
All parties are working collaboratively on the task of
concluding all work necessary for the finalisation of the EA in
early Q1 2020, so as to meet a timeline developed in conjunction
with BEST and Government directive, and consistent with drilling
activities scheduled to commence as planned in late Q1 2020.
C. Environmental Baseline Survey
A substantive piece of work to be undertaken as part of the EA
process is an Environmental Baseline Survey ("EBS"). This survey
will determine the environmental baseline conditions (biological,
chemical, physical) at the proposed drilling location by providing
detailed measures of the currently prevailing environmental
conditions, and against which any potential effects of future
operations can be detected and measured. This includes collection
of samples (at a range of water depths and distances from the
proposed drill site) to characterise macroinfauna, document
physicochemical conditions and characterise the water column. A
photographic survey will be used to further characterise the
seafloor substrates and associated biological communities as well
as identifying any potential archaeological artefacts. This is over
and above the work previously completed (and included in the 2018
EA application) that described the surface and shallow subsurface
conditions of BPC's Southern Licence areas using detailed 3-D
exploration seismic interpretation, multibeam bathymetry, and
hull-mounted sub-bottom profiler.
In conjunction with a marine environmental consulting firm, CSA
Ocean Sciences ("CSA"), a Terms of Reference for this work was
developed, and submitted to BEST. Following a detailed review and
consultation with their appointed external consultants, the Terms
of Reference were approved by BEST, and two specific permits
issued:
-- the first (issued by the BEST Commission on behalf of the
Ministry of Environment and Housing) allowing for the collection of
necessary samples; and
-- the second (issued by the Ministry of Agriculture) allowing
for the export of those samples for analysis purposes.
In the coming weeks CSA will now proceed to deploy the necessary
vessel to site to commence the physical work of sample collection,
and thereafter proceed to the detailed biological, chemical and
physical analysis of samples collected, as required and agreed with
the Government.
D. Response Plan - Advanced Simulation Modelling
A significant component of the EMP is having a proactive and
effective response plan to any potential incidents. Responding
quickly and efficiently requires knowledge of where to respond to
and which habitats to prioritise. To this end, since 2012, BPC has
created and maintained environmental sensitivity maps of coastal
area habitats, fauna and flora and sensitive receptors to allow the
Company, any stakeholders or any Government agencies to have a
better understanding and appreciation of coastal life and usage,
thereby helping direct an effective response (if required).
A key piece of additional knowledge required for finalising
BPC's response plan is predicted fate and behaviour of particles or
matter in the sea depending on prevailing currents, tides, water
depth, surface conditions and weather data. Such predictions are
derived based on advanced simulation models using many years of
historic data. BPC completed such a simulation as part of its EIA
in 2012, but, as agreed with Government, is seeking to supplement
this previous study now with new and repeated studies.
To this end, BPC has engaged leading industry consultant RPS ASA
Group to undertake this study, making use of RPS' proprietary
state-of-the-art three-dimensional modelling tools. Completion of
this work is expected in early Q1 2020, when the outputs of this
study will be incorporated into the EMP as appropriate.
Simon Potter, Chief Executive Officer of Bahamas Petroleum
Company, said:
"As we continue to move toward drilling of an initial
exploration well in The Bahamas in 2020, I am pleased to advise of
two important in-country developments.
First, BPC is seeking to assess the petroleum resources of The
Bahamas, which in the event of a successful exploration campaign
and thereafter development, could be transformational to the
economy of The Bahamas, by adding significantly to the nation's
revenue base over and above that from more traditional sources. In
2016, the then Government established a framework in law for the
establishment of a Sovereign Wealth Fund, for the purpose of
harnessing such revenues. Beyond this, however, we at BPC have long
believed that Bahamians should be able to invest in the Company,
and, in this way, have a 'direct ownership' interest in their own
national resource. We have therefore initiated a process seeking to
create a Bahamas-domiciled mutual fund, which, in the event of its
establishment, would provide a vehicle whereby individual Bahamians
will have that opportunity to invest in BPC's project of
potentially national significance. We expect to be able to provide
full details of this initiative in the coming weeks.
Second, the timely receipt of requisite approvals from the
Government means we have been able to commence a critical piece of
preparatory work ahead of drilling activities: the collection of a
comprehensive range of samples necessary to demonstrate the current
ambient conditions at the proposed drill site. This will allow a
direct assessment of any potential impact from our planned
activities, noting that those activities by their very nature will
be for a short, temporary duration, close to the international
maritime border with Cuba, in a location which is an active marine
thoroughfare serving both the existing petroleum facilities in The
Bahamas as well as the entire region. We remain on track to see
drilling commence on schedule."
For further information, please contact:
Bahamas Petroleum Company plc Tel: +44 (0) 1624
Simon Potter, Chief Executive Officer 647 882
Strand Hanson Limited - Nomad Tel: +44 (0) 20
Rory Murphy / James Spinney / Jack Botros 7409 3494
Shore Capital Stockbrokers Limited Tel: +44 (0) 207
Jerry Keen / Toby Gibbs / James Thomas 408 4090
CAMARCO Tel: +44 (0) 20
Billy Clegg / James Crothers 3757 4983
www.bpcplc.com
END
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