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IK,
Many thanks, really excellent detail and sounds like an excellent plan.
I just hope that BG are proactive in this matter, its really not something to approach in a typical molasses bureaucratic fashion, they need to summon the will, as this is a war footing for Bahamas - to allow them to recover and prosper, with past hurricane impacts, covid, tourism revenue destruction and lockdown impact being the combined aggressor.
Desperate times call for all BG resources to be deployed, adapt, innovate, overcome.
"But when the blast of war blows in our ears,
Then imitate the action of the tiger;
Stiffen the sinews, summon up the blood."
Tib
BG/BPC COLLABORATION.
The answer to me is still a consortium.
IMHO BG should grab the bull by the horns and issue a bond to partake in oil exploration.
BPC in any consortium should retain at least 51%.
Because we never know what govt will be like in the future – remember Anwar Sadat.
A BG bond of $25 million would probably be cheaper than current BPC funding.
In the big picture $25million is nothing cf to the national debt.
Invite several oilcos to join @ small %ages ownership – probably more palatable/attractive with reduced joint and several indemnity.
BG with partial successful ownership would be able to pay off national debt much quicker and proven oil reserves would enable (ironically) in the short term to raise more funds to cover a) current crisis and b) repair damage from natural disasters.
Minnis is IMO the man for this job – his first action as PM was to fly to Houston to get things moving to save his country’s fortunes. He has foresight.
S&E have /are proving their worth against ALL the odds. I would want them in charge.
BPC will have by my estimation enough cash to fund at least the first drill and probably the second. Add $25 mill from BG and we have 2nd /3rd wells guaranteed.
BG will still receive tax take of circa 25% + investment income.
Proven strike and good reserves = buyout by a Major for BG = pay off national debt.
Guaranteed drilling = jobs for the Bahamas and some certainty of a 3rd / 4th “pillar to the economy.
The numbers here are arbitrary and given for food of thought. I’m a bit busy feeding elderly relatives and volunteering for The NHS @ the mom to give too much cerebral application to money matters which are far less important.
I hope you (all) stay well + distant!
Luv ya all.
GL
IK
XX
Tib vg post - I will respond but at the mom need some coffee!
Keep up the really good contribution you make please.
XX
Ik - v good original spot of BG involvement potential , va bene
Thinking this one further, and politicos being what they are.
A bandwagon promoting potential oil find benefit could be very attractive for them to jump on, what other stories of hope have they realistically got to tell their populace this summer?
Focused Media and consultation approach on the key chance of success suitably simplified and palatable for general population. May 2022 is next election, allowing considerable progress in period if oil strike, its a win win, if no oil strike in period then say its work in progress, lots of good data collected etc - if oil strike then it almost 100% guarantees their re election and serious kudos for the key players , that's a heady ****tail for these types.
Royalty Rate % can be monetised and projected by scenario - could adjust if closer partnership with BPC:
• 12½% up to 75,000 bopd
• 15% 75,000 to 150,000 bopd
• 17½% 150,000 to 250,000 bopd
• 20% 250,000 to 350,000 bopd
• 25% over 350,000 bop
Then revenue benefits potential - 5 years to pay off national debt, sovereign fund creation, infrastructure and investment programme is all possible if oil found.
So what sort of deal could be reasonable with what benefit to BPC ?