Oil exploration continues in Belize

Oil exploration continues in Belize

There’s big news brewing for the Belize oil industry, as two companies are expected to conduct exploratory drilling for oil this year. Since Belize Natural Energy struck oil in 2005, no other company has successfully managed to do so. Director of the Geology and Petroleum Department, Andre Cho, says that oil exploration is down worldwide due to a number of factors, but that companies in Belize are looking at hopeful prospects. 

Andre Cho, Director, Geology and Petroleum Department: “The industry hasn’t grown and that’s because of a number of things. One, remember we are dealing with the climate change challenge now and so there’s this thing called energy transition so the world is looking at moving away from fossil fuels and going into renewable energy so there isn’t the same amount of interest or investment in exploration. There is still exploration going on world wide on shore and offshore because we won’t get off fossil fuels right now it will take some time to transition but the investment in exploration is not what it used to be. So we still have five companies, small companies with exploration licenses that is BelDio in the north they are preparing to drill two wells so this year we expect them to drill two wells on two different prospects. We have FCRL in the northwestern part of Belize they are preparing to assess a discovery that Maranco made in the past and they want to appraise it and test it through horizontal wells. If it’s successful then they would probably declare it commercial and start to produce so we’d have a third oil field. Just that this oil is heavy, it’s not like the Spanish Lookout oil, it’s not that light medium sulfur crud.”

Data from the Statistical Institute of Belize (SIB) shows that for ten years since 2013, oil production in Belize has dropped from over seven hundred and ninety-two thousand barrels a year to just over a hundred and seventy-five thousand. Director Cho explained that if production drops below a specific threshold, it will no longer be economically viable to extract.

Andre Cho, Director, Geology and Petroleum Department: “The Spanish Lookout and Never Delay oil fields are producing currently a total of about 430 barrels per day. So we are declining according to the expected decline curve. Now getting to your question about what production level if is economical we had a firm do an assessment of the field a couple years back and I believe the economic limit or the minimum production that would make the Spanish Lookout field economical I think it was about 225 barrels per day and we’re at 425 for Spanish Lookout. Never Delay is just producing about six barrels per day small production but still contributes to the overall production. So we are about 200 barrels per day away from that economic limit. BNE along with our participation are in the process of trying to increase the production from the field looking at new zones that have oil and producing those zones. So we have had good results in one well so far and we’re going to apply the same interventions in other wells so we expect to increase production. The economic limit like I said is about 235 barrels and the expected time to have reached that would have been 2030 so let’s say in about six more years.”

Apart from BelGeo and Fire Creek Resources Limited (FCRL), Viva Energy is also preparing to drill for oil south of Belmopan. Meanwhile, US Capital Energy’s concession lies in southern Belize, falling within seven Maya communities. The southern concession, however, comes with some hiccups as US Capital Energy has had to seek consent from the Maya villages in the area.  Director Cho provided an update on the progress made in achieving consent.  

Andre Cho, Director, Geology and Petroleum Department: “We have US Capital in the south which I am sure you’re familiar with because they are working in that part of Toledo that requires the consent of the Maya Communities and requires us to go through what they call the FPIC protocol process to consult with them and get their consent. So US Capital has a seismic program plan and three wells. They have the most exploration work plan at the moment of the five companies with licenses. We started the consultation process in October 2022 and we’re in March 2024. We’ve signed, it’s seven villages we have to get consent from and we’ve got consent from six villages. So we’ve finished the process with six and we have one left Santa Ana and we are in the process of trying to finalize the consultation process with Santa Ana so it has been about one year and five months, almost a year and a half since and once US Capital has gotten the consent from this last village they will embark on the exploration program and drill three wells. The southern part of Belize where they have their license has potential, good potential for commercial oil.” 

Cho had much more to say about the state of the oil industry and we’ll be hearing more from him in a subsequent newscast.

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