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US Capital applies for new oil concession

By Benjamin Flowers
Staff Reporter

While the oil industry in Belize is facing a major decline, with only one company producing and several relinquishing their concessions, US Capital Energy Limited is preparing to start over, in a revised concession area.

According to Director of the Petroleum and Geology Department, Andre Cho, US Capital’s license for its old concession area expired in 2016 and the company has submitted an application to the government of Belize for a new concession. The application has several layers, including holding consultations with the communities in the surrounding Sarstoon Temash National Park.

The Attorney General’s Ministry has already sent letters to the communities in the area to get the consultation process underway and is awaiting a response on a date. The Reporter has confirmed that several Maya communities have already received their letter; however, the village of Barranco has not. The office of the Solicitor General confirmed that the village is on the list of communities that need to be notified, but up to press time the letter had not reached Barranco.

Cho emphasized that the industry is in desperate need of striking oil, as production from Belize Natural Energy has substantially decreased, now averaging around 900 barrels of oil per day. He noted that the reduction falls “more or less” in line with the department’s projections that production would decline into unprofitability by 2021.

“Oil companies are waiting for the price on the world market to hit $80 a barrel for exploration to become profitable,” Cho said. “We’re almost there, so we should be seeing companies showing interest again soon.”
US Capital’s first concession was very controversial, as members of the Sarstoon Temash Institute of Indigenous Management (SATIIM) challenged its validity on several grounds, eventually taking the matter to the Supreme Court. Chief among the concerns was that the company did not consult the communities, as it is preparing to do with the current concession application.

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