TotalEnergies has received the operatorship of shallow-water Block S4 off Guyana via a five-year production sharing contract (PSC) with Guyana’s Government.
The French oil major holds a 40% stake in the block and leads the consortium, which includes QatarEnergy (35%) and Petronas (25%).
The contract, signed at the Ministry of National Resources, includes a $15m (€12.97m) signing bonus, which the government plans to deposit into the Natural Resource Fund.
It is said to be the first PSC under Guyana’s new fiscal regime.
The new regime includes a 10% corporate tax, updated environmental and regulatory standards and increased penalties for failure to meet work commitments.
Guyana's Energy Minister, Vickram Bharrat, said: “Every agreement must yield benefits for Guyana and our people.
While we welcome international investment, our partnerships must support national development and uphold the highest environmental standards.
“Few nations can produce nearly a million barrels of oil per day while remaining carbon negative.
"Guyana continues to show that sustainable development and environmental responsibility can go hand in hand.”
According to TotalEnergies, Block S4 spans around 1,788km² and sits roughly 50–100km offshore in water depths of around 30–100m.
The initial work programme requires a 2,000km² 3D seismic acquisition.
This award follows a 2023 tender round that allocated eight of 14 offshore blocks to local and foreign producers.
Consortia comprising Arabian Drillers, Cybele Energy, Delcorp, Exxon, International Group Investment, Liberty Petroleum, Montego Energy, Sispro and Watad Energy also won blocks in the round.
TotalEnergies exploration senior vice-president Nicola Mavilla said: “TotalEnergies is delighted to bring its expertise as an operator to Guyana, in a shallow-water offshore block within this prolific basin, and to further strengthen its global strategic partnerships with QatarEnergy and Petronas.
“This block fits our strategy of exploring for material, low-cost and low-emission resources.”
According to Reuters, Guyana’s oil output has been led by a consortium headed by ExxonMobil since production began in 2019.
The government plans to sign more agreements this year, allowing exploration in at least two additional offshore areas allocated in the 2023 tender.
These agreements will be subject to the completion of negotiations on bonuses and work programmes.
Earlier this year, the Guyana Government cancelled an exploration licence for the Corentyne block, previously held by Frontera Energy and CGX Energy, claiming that the group had not met conditions for an extension.
