THERE was a dream of a prosperous Jamaica, free of debt and able to pay its bills. One could merely whisper it. Anything more than a whisper and it could vanish, so fragile was it. But it was the dream of a few stubborn men who could not be convinced that there was no oil or gas on or offshore Jamaica. And still the dream lives on.

On the fifth floor of the Petroleum Corporation of Jamaica (PCJ) building at Trafalgar Road, Kingston, a small team of men and women is feverishly working at realising the dream of one of those stubborn men, Dr Raymond Wright, the late group managing director of the PCJ and the powerhouse behind the conceptualisation and founding of the PCJ in 1979.

Wright built an illustrious career as a geologist, having attained, at the young age of 33, the position of commissioner of mines at the Geological Survey Department. His significant achievements in field mapping, well logging and karst hydrogeology, as well as the provision of geological services, regulation of petroleum and mining activities, geological mapping and mineral exploration, made him a virtual household name in Jamaica. He died in July 2011.

It’s a small team at today’s PCJ but one fired up by Dr Wright’s big idea that Jamaica has oil and gas.

“There is oil and gas in our territory in commercial quantities,” insisted current PCJ Chairman Christopher Cargill. “I know it,” he told the Jamaica Observer with a straight face. “And I am convinced that it can be a game-changer for our country. Raymond Wright was decades ahead of his time.”

Cargill, like Energy Minister Phillip Paulwell, was infected by Wright’s enthusiasm and belief that Jamaica has oil and he has the support of two other equally firm believers — Winston Watson, group general manager, and Brian Richardson, manager, oil and gas.

Cynicism has always followed the various attempts at finding oil. But PCJ quieted many doubters by managing to bring aboard no less than the United Kingdom’s leading independent oil and gas exploration firm, Tullow Oil plc, and to get them to bankroll what is the fifth campaign in the long, dogged search for the precious commodities.

It began for Jamaica in the 1950s. Two wells were drilled in Negril, Westmoreland. The seismic work was done using soundwaves to image the subsurface to determine if there were geological structures and hydrocarbons which contain crude oil. From that there were clear hydrocarbon indications, said Richardson, who is now the man on the bridge.

More indications of oil and gas

The data culled from that first campaign fuelled greater optimism and formed the basis for the second and third — between the 1960s and 70s. This time, five companies from the United States and Canada prospected across Jamaica, drilling eight additional wells — seven onshore and one offshore — in St Ann, the Cockpit Country, Content, Santa Cruz, Clarendon, and the Pedro Banks. Again, there were indications of oil and gas but it was not determined if it was in commercial quantity. The companies packed up their equipment and left.

Richardson believed that the prospectors “did not fully understand the data and made misjudgements, because they were using an approach based on the US methods”.

In the 1980s, with Dr Wright at the helm of the PCJ, Jamaica persisted with the search. Two wells were drilled at the Pedro Banks, one by the PCJ and a second by an American company. More indications of the presence of oil and gas were confirmed but still not yet in commercial quantity.

Up to that point, Richardson explained, there was no deep water exploration. All wells were sunk less than 100 feet in depth. In this latter case, one rig drifted three miles off its intended drill target and when the prospectors did not find what they were looking for, they, too, packed up and left, having spent an estimated US$2 million.

Following a lull, PCJ revived its oil and gas exploration programme in 2005 and attracted two small companies — Sagres Energy from Australia and Finder Exploration from Canada. The lack of modern technology that held back progress had, by now, improved by leaps and bounds, thanks to Brazil. And working with the rising data bank from the previous exploration campaigns, they carried out additional seismic and geological work. Potential resources were identified on the Pedro Banks.

Estimated three billion barrels of oil at Pedro Banks

But the companies did not have the funds to drill further and abandoned the effort after failing to find partners willing to share the risks. However, all was not lost. The new seismic data had revealed even clearer hydrocarbon indications and at last the potential for commercial production.

Sagres estimated the Pedro Banks had a reservoir of three billion barrels of oil and Finder Exploration put it more conservatively at 800 million barrels.

Wright and the PCJ team were now even more convinced that they were on the right track, and while fending off the cynics, they longed for the day when they could announce to Jamaica that ‘we have found oil’.

In 2012, the company shook off the disappointment of the last campaign and re-engaged with the market. PCJ made two key moves. It appointed an engineer and a geologist with considerable experience to spearhead the oil and gas campaign. The two are Watson, an insider, and Richardson. With the support of Minister Pauwell and Chairman Cargill, they were mandated to find oil.

Watson has more than 16 years of experience in senior management, having held positions at firms in Barbados, Canada and Jamaica covering general management and technical/operations management. He was appointed general manager of Petrojam Limited in 2000 and then promoted to the group general manager for the PCJ group of companies, Petrojam’s parent company, in 2014.

He holds a Bachelor of Science Degree in Engineering and a Master of Business Administration from the University of the West Indies; as well as a Master’s in Applied Science in Engineering from the University of Waterloo. He is a member of the Association of Professional Engineers of Ontario, Canada and a past member of the Institute of Electrical and Electronic Engineers and the Barbados Association of Professional Engineers.

Richardson, in his capacity as manager, oil and gas, is responsible for developing and managing all activities related to the exploration of oil and gas within the jurisdiction of Jamaica. He is a geologist by profession and has worked extensively in the geological sciences, collaborating with industrial clients on several large projects across the globe.

He has more than 18 years of experience in several areas of the discipline, including environmental geology, engineering geology, hydrogeology and petroleum geology.

Prior to joining the PCJ, he was employed to Jacobs Engineering in the UK where he worked on water-related development projects and examined the environmental impacts of the energy industry there and across the globe. He holds a BSc in Geology from the University of the West Indies, an MSc in Hydrogeology from the University of Birmingham in the UK and a post-graduate certificate in GIS and Water Resources Modelling from Purdue University in the US.

He is a Fellow of the Geological Society of London and a member of the American Association of Petroleum Geologists among other professional societies. He has also served as council member for the Geological Society of Jamaica.

Tullow remained at the negotiating table

The second key move by the PCJ was to send a team led by Richardson to make presentations at major oil and gas exploration fairs; for example, in Houston, Texas and Colombia, to drive interest back to Jamaica. Backed by the island’s considerable archive, Richardson was able to attract Tullow Oil plc which, remarkably, remained at the negotiating table until a deal was struck, taken as a sign of great confidence in the project. Remarkable also is the fact that the company is doing all the spending.

Tullow Oil describes itself as: “A leading independent oil and gas exploration and production group, quoted on the London, Irish and Ghanaian stock exchanges and is a constituent of the FTSE 100 Index. The group has interests in over 140 exploration and production licences across 21 countries which are managed as three regional business units: West and North Africa; South and East Africa and Europe, South America and Asia.”

Website information also shows that in 2007 Tullow hit it big with its largest ever discovery — the Jubilee field offshore Ghana. It claimed a 100 per cent exploration success rate in Uganda, moving this project closer to the commercial threshold for development. Overall, the group had a 56 per cent exploration success rate with nine discoveries out of 16 wells.

It generated “record production, sales revenue, operating cash flow and growth in reserves and resources”. Financial results, however, were impacted by lower UK gas prices, increased exploration write-offs and higher depreciation and interest charges.

On November 1, 2014, PCJ and Tullow Jamaica Limited, a wholly-owned subsidiary of Tullow Oil plc, inked a Production Sharing Agreement (PSA) to explore offshore Jamaica in the Walton Basin and the Morant Basin. Exploration will cover 10 of Jamaica’s 31 blocks located south of the island or 32,065 kilometres.

‘Oil exploration is a marathon, not a sprint’

Fighting strenuously to manage expectations, Paulwell said “if our oil and gas exploration programme is successful, it can be a game-changer for our country”.

Using the more conservative figure of 800 million barrels, the value of the Pedro Banks reservoir would be US$8 billion or J$800 billion.

But Tullow Oil’s exploration director, Angus McCoss, immediately cautioned patience: “This is a long-term project and a great deal of geological and other essential work is required before any drilling can take place.” Interpreted, that means that exploration could last up to 7.5 years before commercial quantity is found, then the production phase would begin and that “can last between 17.5 and 19.5 years”.

Supporting McCoss, Watson added: “Oil and gas exploration is a marathon and not a sprint.”

Under the 25-year Production Sharing Agreement, Jamaica and Tullow will share the proceeds and Jamaica stands to develop a modern oil and gas industry that will necessitate training of Jamaicans. However, immediate jobs could come in custom brokerage, vessel support during seismic studies and the use of local facilities and services.

Asked to describe what impact an oil find could have on Jamaica, Richardson said: “As a country we would be given the opportunity to develop our resources. Jamaica needs this game-changer. The biggest impact is that it would allow us to change our debt profile. People would see us in a different light. We would be able to pay our bills. And our heavy dependence on imported oil for energy would be considerably reduced.”