The Bahamas Petroleum Company plc. (BPC) was formed in 2005 as an oil and gas exploration company seeking to prove the existence of commercial volumes of oil in Bahamian waters. It holds 100%-owned offshore exploration licences covering some 4 million acres (16,000 sq. km) exclusively focused on the Commonwealth of The Bahamas, with offices in Nassau and the Isle of Man, UK. The exploration licences were granted in 2007 and the shares of the company became publicly traded in the UK on the London Stock Exchange (AIM Registry) in 2008. A major fund-raising in 2011 underpinned a significant expansion of the company’s technical activities with, today, cumulative capital investment amounting to in excess of $50 million. The newly elected Government confirmed in 2013 that BPC can undertake exploratory drilling under the protection of strengthened and modernised regulations, currently nearing completion.

***“We are closer now than ever to realising our goal of exploring the hydrocarbon potential of The Bahamas and look forward to the near-term future with excitement and confidence,” Simon Potter, BPC’s Chief Executive Officer (Annual Report –***

BFSB’s GATEWAY BFR Editor sat down with the CEO to get some answers about the state of play on the exploratory drilling.

**GATEWAY BFR:** Bottom line – when will we see the first well?

**SP:** *We have demonstrated a dramatic reduction in technical risk through the acquisition and interpretation of modern data and are committed to conducting an environmentally responsible exploration drilling programme in the near future. Our first exploratory well is likely to be in the second half of 2014.*

**GATEWAY BFR:** Were these “technical risks” a huge factor in the decision-making process?

**SP:** *Since 2005 BPC has worked continually to reinforce its view of prospectivity with an extensive programme of risk reduction activity. Technology has been leveraged through the acquisition of an extensive, modern 3D seismic database utilising a type of survey conducted for the first time in Bahamian waters which, when combined with BPC’s unique access to historic data, provides a significant competitive edge in the pursuit of success. The support facilities available to BPC from such local industrial areas as Grand Bahama and the Gulf of Mexico offer unique and competitive access to contractors and suppliers realising significant cost advantages.*

**GATEWAY BFR:** We have to ask – WHY The Bahamas?

**SP:** *Exploring for energy in the territorial waters of The Bahamas continues to be attractive for BPC and remains its sole focus. We have examined opportunities elsewhere but quickly concluded that the nature of the prospectivity in The Bahamas, its low relative risk, the scale of the structures, our unique access to data and understanding, does not merit us incurring high entry costs elsewhere.*

**GATEWAY BFR:** With the long-awaited decision on exploratory drilling earlier this year, what are the next steps?

**SP:** *This last year, 2012, was a busy one for Bahamas Petroleum Company. We worked hard on the environmental and technical fronts to progress towards the ultimate goal of drilling an exploration well. In support of drilling preparedness, the Environmental Impact Assessment (EIA) has been made a public document, through posting on their website by the Bahamas Environment, Science and Technology Commission (BEST), thus being open to review, scrutiny and comment by all agencies and the people of The Bahamas. The Government has made clear its mandate for the Company to commence exploration drilling once modernised and strengthened environmental regulations, believed to be in an advanced state, are adopted by Parliament. Compliance with such an enhanced level of standards was anticipated in the EIA submitted to the Government. Work now continues on the related Environmental Management Plan (EMP) and in particular the generation of new environmental sensitivity maps for the region.*

*The completion of these plans and the availability of such an extensive, up-to-date database underpin the commitment of the company to conducting an environmentally responsible and safe exploration drilling programme in the near future. We are confident that our practices will comply with international standards and ensure we are able to maintain and extend our licence to-operate in all the wider communities in which we participate.*

*Thus potential well locations have been identified, well design activities have commenced and initial planning is underway for the start of drilling. We are technically ready to safely execute the first exploratory well in Bahamian petroleum exploration licences in 25 years.*

**GATEWAY BFR:** What will be the cost of this next phase to the Government of The Bahamas?

**SP:** *Such a drilling programme is at no financial risk or cost to the Government. Rather, in the event of success, a substantial revenue stream will be generated for the country from day one of production. In addition, new employment opportunities will be created with a requirement for new vocational training and skills development for local firms to be well represented in this new industrial sector.*

**GATEWAY BFR:** Will the people of The Bahamas be able to participate in this venture?

**SP:** *As a part of the broader set of opportunities, Bahamas Petroleum Company is looking to list on the Bahamas International Securities Exchange (BISX) to give the people of The Bahamas the opportunity to take ownership in the company through the purchase of its shares. We aren’t looking to raise capital in The Bahamas; just to give those Bahamians who wish to share in the capital growth of the company the opportunity to invest. We would do this by the issuance of a Bahamian Depositary Receipt (BDR). A BDR is a type of security denominated in Bahamian dollars which permits Bahamian investors to acquire interests in non-Bahamian securities without additional expenses. It has to be approved by The Central Bank of The Bahamas and The Securities Commission. The BDRs are priced based on the value of the underlying shares on their home exchange (i.e. the London Stock Exchange).
With such a range of opportunities for investors, the people and the Government of The Bahamas – all indications continuing to suggest the presence of oilfields of huge potential – the company is committed to fully exploring the treasures contained in the waters of The Bahamas.*

Photo Caption: Joy Jibrilu Director, Bahamas Investment Authority, Simon, Hon. Khaalis Rolle MP, Minister of State, Investments; Jobeth Coleby, BPC Inhouse Counsel