NASSAU, BAHAMAS — Bahamas Petroleum Company (BPC) has fired back at a US-based non-profit that recently asserted the Bahamian government has full legal authority to deny the Bahamas Petroleum Company’s (BPC) request to review its licenses.
BPC said in a statement yesterday it is “entirely spurious for foreign environmental groups to offer unsolicited legal advice on a matter of which they have no background, no knowledge, no insight and certainly no experience or expertise”.
The company was responding to recent assertions by Earthjustice, which contended in a letter addressed to Prime Minister Dr Hubert Minnis and Environment Minister Romauld Ferreira that the Bahamian government “has broad discretion under the law to deny BPC’s request for renewal of its licenses and that BPC has no right of renewal”.
Earthjustice said it came to that conclusion after having reviewed relevant provisions in the Petroleum Act and its accompanying regulations, along with the license agreement.
Outgoing BPC CEO Simon Potter said yesterday: “Environmentalists have repeatedly complained that the confidential license documents between BPC and the Government of The Bahamas have never been published. Now these same environmentalists appear able to comment in detail on their contents and their applicability. Well, which is it?
“The simple fact is that the government of The Bahamas awarded hydrocarbon exploration licenses to BPC in 2007. Since that time, those licenses have been extended and renewed on various occasions by administrations of each political persuasion, in accordance with their terms, in reliance of which BPC has expended over $150 million in safe and responsible activities honoring its obligations under those licenses.
“The licensing regime in The Bahamas is no different to that in place in many other advanced economies, a core component being the notion that energy companies agree to assume considerable financial risk (whilst host governments do not) in the clear expectation that license rights, once granted, will be respected.
“If this were not the case, if the integrity of agreements could not be relied upon, then companies would never invest such huge volumes of capital, let alone explore for resources to enrich a nation’s economy, with a resource that takes decades to create a return on that company’s investment.
“It is thus entirely spurious for foreign environmental groups to offer unsolicited ‘legal advice’ on a matter of which they have no background, no knowledge, no insight and certainly no experience or expertise.”
BPC undertook a controversial exploratory well exercise in its search for commercial quantities of oil in The Bahamas. In February, its initial well came up dry; however, it has since announced its intention to continue exploration in Bahamian waters and drill another exploratory well amid an ongoing court battle with environmentalists.
BPC’s incoming chief executive, Eytan Uliel, recently stated during a podcast responding to investors’ queries that it was “our right to extend” the company’s four oil exploration licenses beyond their end-June 2021 expiration.
He confirmed that BPC, which is soon to be renamed as Challenger Energy Group, has submitted the necessary documentation to the government to start the renewal process.
Earthjustice said denial of BPC’s request to renew “is not only within the lawful authority of The Bahamas, but it is also consistent with the government of The Bahamas’ public opposition to offshore drilling activities as well as its nationally determined commitments under the Paris Agreement”.
According to the non-profit, BPC’s latest renewal request, unlike the previous, is discretionary.
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