Guyana’s President, Dr. Mohamed Irfaan Ali, has signaled that his administration will embark on an expanded exploration push. “We will press forward with new exploration under a stronger Production Sharing Agreement,” he announced immediately at his swearing-in for a second term on Sunday.
Ali framed exploration as a foundation for inclusive growth. “Yes, our oil and gas sector will continue to grow, expanding production and revenue for our people,” he said, noting that benefits must be widely shared. “The benefits are greater, the gains are wider, and the wealth is truly for the people.”
This comes at a time when neighbouring Suriname is set to outpace Guyana’s exploration activity. According to Wood Mackenzie, 2025 is poised to see more exploration and appraisal wells drilled in Suriname than in Guyana for the first time since the landmark Liza discovery was made.
However, Guyana’s offshore Stabroek Block continues to produce robust results. In 2024, ExxonMobil drilled eight exploration and appraisal wells, all of which yielded hydrocarbons, while an additional well was unsuccessful. This year, the Stena Carron drillship is drilling three more wells.
On the production front, the Yellowtail project recently started output ahead of schedule, bringing total capacity in the Stabroek Block above 900,000 barrels of oil per day and moving toward a long-term target of 1.7 million barrels of oil per day via further developments.
The new PSA mandates a 10% royalty rate and a 10% corporate tax. Additionally, the cost recovery ceiling has been lowered from 75% (Stabroek PSA) to 65%, while profit sharing remains a 50/50 split between the government and contractors. Industry analysts have put Guyana’s new fiscal terms on par with those of its peers in Latin America.
An August 2023 report by S&P Global showed that the Guyana basin remains an attractive investment destination, even with the new PSA terms.
