An Order to exempt Tullow Guyana BV and Eco (Atlantic) Guyana Inc from various taxes has been laid in the National Assembly.
Signed by Minister of Finance Winston Jordan on February 14th, 2019, the order specifies that the written laws mentioned in Section 51(2) of the Petroleum (Exploration and Production) Act or any part thereof shall not apply to or in relation to the Licensees Tullow Guyana BV, Eco (Atlantic) Guyana Inc and Total E&P Guyana BV as specified in the Production Sharing Agreement (PSA) signed between them and the Guyana Government.
Section 51(2) lists the Income Tax Act, the Income Tax (In Aid of Industry) Act, the Corporation Tax Act and the Property Tax Act as legislation which, by order of the Minister (subject to an affirmative vote of the National Assembly), shall not apply to a licensee in possession of a PSA with government.
Meanwhile, the PSA with Tullow Guyana BV et al specifies that the company shall pay no tax, no value-added tax, duty, fee, charge or other impost on income derived from petroleum operations or in respect of any property held, transactions undertaken or activities performed for any purpose authorised under the PSA.
The exemptions include import duties on items listed in the PSA, Local Government rates and taxes and license fees paid to government.
Tullow recently announced that it plans to drill two wildcat wells on its Orinduik licence from June 2019 onwards using the Stena Forth drillship.
“The first well will target the Jethro prospect which is a Lower Tertiary target in approximately 1,350 metres of water. The second well will be the Joe prospect, an Upper Tertiary target in water depths of approximately 650 metres,” a statement ahead of the April 25th Annual General Meeting explained. It added that both wells are targeting prospects of 100 to 200 million barrels of oil.
The Carapa-1 well on the non-operated Kanuku block, according to the company, is expected to be drilled in the third quarter of 2019. The Carapa prospect is a 200 million barrel Cretaceous target located in 70 metres of water and will be drilled using a jack-up rig.
