Challenger Energy Group (CEG) yesterday released its 2023 strategy and work program update, revealing that the company, formerly called Bahamas Petroleum Company, remains locked in negotiations with government on the renewal of the company's licenses for another multi-year exploration period.

The company noted in its update that it is "seeking alternative means of achieving value" from its investment in The Bahamas, which includes the drilling of an exploratory well in the southern Bahamas at the beginning of 2021.

The company continues to expand its exploration for hydrocarbons into the Caribbean and South America, but has yet to have much success in The Bahamas in the search for oil, and even less success gaining support for its drilling efforts in the country.

"The company continues discussions with the government of The Bahamas in relation to the extension of the company's licenses into a third, three-year exploration period," it notes.

"At the same time, the company is seeking alternative means of achieving value from its considerable historic investment in The Bahamas."

Challenger has had disagreements with the government over license fees, and clashes with environmentalists because of its drilling efforts.

The Bahamas is moving towards sustainability and the utilization of its blue economy to gain carbon credits. Prime Minister Philip Davis told the media in mid-2022 that his administration will verify the extent of oil deposits in The Bahamas and use that data as a commodity to collect carbon credits, by not extracting that oil. That position taken by the government is in total opposition to the business model of CEG.

Companies known to be associated with global warming, like oil companies, are now looking at how they can collect their own carbon credits by what they decide not to do.

Davis said last June that The Bahamas does not have any active exploration licenses at the moment. He did not comment then on whether or not the government would renew CEG's licenses.

Davis was resolute, though, that if oil is within The Bahamas' territory it would not be extracted, but the knowledge of its existence and the country's willingness to leave the fossil fuel in the ground, would be used to garner carbon credits that would then be sold on the global carbon credit market.

"I have now identified what I will do in respect to the prospect of oil being in our jurisdiction," said Davis.

"You would have heard me speak when the cry about drilling was in the air and there was much controversy over the fact of drilling. My response was always, 'look, don't be concerned about drilling, be concerned about exploitation, because drilling is only to discover whether or not you have oil'.

"That fact that you have oil doesn't necessarily mean that you have to extract the oil. And with this new advent of being able to sell your carbon credits, you could, under article six of the Paris Agreement, we can have what we call an additionality.

"The additionality is about not exploiting natural resources that increase emissions, and/or preserving habitats that absorb carbon."

It is through the additionality, Davis explained, that by leaving any discovered oil deposits in the ground, The Bahamas will earn carbon credits.

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