Economic Opportunity/Benefits to the Economy

Economic Opportunity

For over 25 years no other company has shown the interest, insight nor the commitment of Bahamas Petroleum Company in bringing to the attention of the Government, at no financial risk or cost to it or its people, the potential wealth that may reside in Bahamian waters. The Company will continue to emphasise the direct benefits of Government royalty income from the very first day, indeed the first barrel of production. This Government income is modelled at the level in excess of US$20 billion from a 1 billion barrel discovery, whilst it is the oil company that bears the entire cost and financing of development and operations, as well as the risk that production is sustained over time as projected. Such an income stream and new industry would make the national economy less susceptible to slumps in other sectors, less exposed to the vagaries of other nations' economies and afford a greater level of energy security whilst providing options for reduced prices of fuel and power.

It is also clear that the creation of such an industry will have multiple additional benefits. Success will offer considerably wider opportunities through infrastructure investment, direct foreign investment and the development of new and established companies in industries involved directly and indirectly in oil development and associated activities. New employment opportunities will be created with a requirement for new vocational training and skills development. It will be an important consideration in the future that local firms are well represented in this new sector. Such firms will need to be supported in the need to demonstrate that they can meet, and better, prequalification standards associated with international industry health, safety and the environment requirements.

The Company is committed to seeking a listing on The Bahamas International Stock Exchange in the form of Bahamian Depositary Receipts (BDR) to ensure options for Bahamians to share in the potential wealth to be created by any future capital growth of the Company. This potential growth is based upon the enormous upsides associated with the extensive mapped prospectivity derived from 3D seismic coverage anticipating an extension of the existing, proven Cuban play types into Bahamian waters, albeit at significantly deeper stratigraphic horizons. Such a new investment option would represent a unique value proposition in The Bahamas.

An Economic Opportunity for The Bahamas

If commercial quantities of oil are discovered in offshore waters, the construction and production activities to bring the oil to market as well as the royalties earned by the Government will bring significant benefits to the economy of The Bahamas - detailed below.

Benefits to the Economy