United Oil and Gas (United Oil) has valued the largest repository within its wider zones of oil exploration offshore Jamaica as being worth J$3.5 trillion, or US$23 billion, at current oil prices.
It still, however, needs to prove that substances that resemble oil are indeed oil, and will require investments to dig the ocean floor for core samples.
“The potential net present value at a 10 per cent discount [is] US$23 billion to United at 100 per cent working interest over the 25-year production life of the licence,” according to United Oil in a statement from CEO Brian Larkin.
The oil quantum figure comes in at current oil prices, once discounted for inflation at 10 per cent.
The region that it focuses on is called the Colibri zone, which holds 2.4 billion barrels of substances that resemble oil. It forms part of its vast exploration zone that spans 22,400 kilometres, or essentially the entire south of the island called the Walton-Morant licence.
The company also stated that its break-even point for drilling is a fraction of the current US$77 a barrel oil on the world market.
“Success case [is] break-even oil price of US$25 per barrel,” stated the company.
All these elements favour the company finding a drilling partner to cut down on the US$30-million estimated cost to drill. But Larkin mentioned a series of global shocks that have affected oil exploration.
He, however, added that the Government remains supportive of the search, based on its potential to transform the fortunes of the historically cash-strapped nation.
“The Government of Jamaica remains supportive of hydrocarbon exploration and achieving the potential of this licence. Against the global backdrop of geopolitical instability, exploration and development success on the licence could be transformational for the nation, delivering long-term energy security, generating significant revenue and creating economic opportunities for the nation, in line with Jamaica’s National Energy Policy,” stated Larkin in a statement.
During this extension, United will undertake additional technical studies, including “piston core sampling and seismic reprocessing”, aimed at further de-risking the petroleum system and better defining the prospects and leads identified on the licence, it stated in a release.
The company advisers are Energy Advisors Group from Texas, United States, and Envoi from London, United Kingdom.
“[We] will now continue in efforts to secure a partner, in a market that the board believes holds renewed interest in exploration opportunities worldwide, driven by the strong future demand for oil and gas,” stated the company.
Source: business@gleanerjm.com
Message Board Archives
Jamaica Oil valued at US$23 Billion at current prices
Great news!
In reply to VIX
“It still, however, needs to prove that substances that resemble oil are indeed oil, and will require investments to dig the ocean floor for core samples”.
I guess from their experience and knowledge the expectation is that the substance is oil but still needs to evaluate and confirm core samples.
In reply to VIX
in one way, in another just imagine an oil spill pon Yard shores! Time to harness more sun too.
In reply to Brerzerk
Annada rich Caribbean country coming up soon,finding out if it's oil shouldn't be a difficult,as a boy in Trinidad oil sometimes burst through the ground,there was a company that specialised in capping the flow with cement,they were Haliburton and Tucker.
In reply to Slipfeeler
Coconut oil?
In reply to Slipfeeler
I may the only Jamaican hoping that Ja does not find oil until we have leaders worthy of managing the country. Look up the meaning of DEFALCATION. Ja would make Nigerians look like choir boys.
God help us!
If a egg Jamaica in a di red!
In reply to Headley
Understandably, we are still unsure whether if it will be a blessing or a curse for Jamaica with so many politicians waiting in the wings to capitalize 
In reply to Headley
You might have to wait till eternity to find such a leader, might as well drill the oil.
that is not a lot of oil! at todays price that is about 300 million barrels!
In reply to Headley
Can you point to just one energy producing country that's free from corruption in the sector?
Could it be that you're so accustomed to things being the way they are and so invested in the negativity that the mere idea of positive improvement feels like a personal assault?
In reply to camos
It's massive for a small country!
Wait for the chickens to hatch.There are too many unknowns to start put a valuation on a possible deposit of hydrocarbons in the basin.
In reply to VIX
Try Norway.
In reply to Headley
Just as I thought.
You can't name any. Now go out and support Jamaica's energy production thrust!
As a boy growing up in the hills of Hanover all I ever wanted to be when I grew up was a 'Sugar Boiler" (Pan Floor Attendant) at one of those 'beloved' sugar factories that spread across Jamaica. However, by the time I came of age, those sugar factories were no longer considered 'beloved'. I then switched my ambition to the Bauxite Industry, but that also died.
Finally, I think I have something promising to pursue. Look out Yaad, mi deh com.
In reply to VIX
If price falls to$50/ barrel, how attractive that becomes in an offshore field?
In reply to camos
Oil price fluctuates as any other commodity in a market economy. That’s not Jamaica’s concern at this time, the only real concern is whether those hydrocarbons are indicative of oil.
In reply to Slipfeeler
Not all oil fields can be developed at all price points, as price increases more oil can be produced.
In reply to camos
Yes, the world would have been a much better place if mankind hadn’t taken chances or ventured into new territory for fear of failure, especially considering there'd be chance of success in the venture!
Jamaica should definitely not take the risk because, oh dear!!! - they might be successful! And that’s a bad thing for the misfits!
In reply to VIX
if they're going to invest in oil, they need to do it quickly, because it is becoming increasingly difficult for oil and gas producing countries to find investors. Both Irfan Ali and Stuart Young stated this at the energy conference last year. So they need to move in haste
In reply to VIX
Is that your understanding of my post , or your personal position?
In reply to Jumpstart
we are not near that stage, be careful of scare tactics designed to trick people into discounting resources!
In reply to VIX
Who are the misfits? I saw that both Ghana and Guyana successfully made the transition, so why not Jamaica?
In reply to Slipfeeler
The misfits are the people of Caribbean origin domiciled in their great USA who believe themselves superior to Caribbean residents.
I'm all for Jamaica exploiting its natural resources! The misfits will not support that.
In reply to VIX
Understandably that multinationals will continue to exploit us in the Caribbean as seen in the cases of Trinidad and Tobago and now Guyana, we are aware that Jamaica will experience the same exploitation, whereby multinationals make off with huge profits and a few dollars trickle down to Caribbean people. Although we are well aware that the trickling of dollars will still be considered a vast financial improvement to any Caribbean country.
In reply to Headley
[b]I may the only Jamaican hoping that Ja does not find oil until we have leaders worthy of managing the country. Look up the meaning of DEFALCATION. Ja would make Nigerians look like choir boys.
[/b]
You are not. But that is the best posting you have made in a long time,perhaps for ever.
There are at least two of of us.
In reply to hubert
Agreed that financial corruption is worrisome part of Jamaica finding oil. Whichever political party in power at that time will be able to finance political advantage.
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