Honduras and BG Group Signed Oil and Gas Exploration Memorandum

The government of Honduras, together with British multinational company BG Group, signed a memorandum of agreement on oil and gas exploration in La Mosquitia’s northeastern jungle area.

The memorandum was signed by Minister Rigoberto Cuellar of the Natural Resources and Environment of Honduras, and VP and Legal Representative Carlos Quintana of the BG Group at Tegucigalpa, the president’s palace.

Porfirio Lobo, the President of Honduras and the honorable witness at the recent signing ceremony said that the event was historic.

According to Cuellar, there has been no serious appraisal of the hydrocarbon potential of Honduras in three decades, and it is time for its people to get rid of their doubts as to whether the country really does contain oil, and in what amounts.

Cuellar added that partnering with the British firm will ensure the needed technical and monetary capability and the transparency of the program. Moreover, the partnership will guarantee social responsibility, specifically in the environmental aspect.

According to the office of the president, BG Group has submitted an application for a permit to operate with the Ministry of Natural Resources and Environment.

The memorandum provided several special benefits, according to the government, specifying that BG Group consented to pay royalty fees during the oil exploration stage and put money into social development programs in the region’s communities.

It didn’t mention the specific amount of royalty or oil investment that BG will put in during the exploration stage.

The coverage of the memorandum of agreement with BG Group is only 15 percent of the area that is potentially rich in hydrocarbons, said Cuellar.

In the latter parts of the 1990′s, experts from Russia found proof of petroleum in a region of Honduras spanning from Atlantida in the north to La Mosquitia in the northeast. However, the experts did not specify the amount or type of reserves they found.

By: Chris Termeer