Vice President Bharrat Jagdeo believes that Venezuela’s heightened efforts to annex Guyana’s Essequibo region is fueled by his country’s success in the oil and gas industry.
“It is a kind of greed too because they have seen the successes in oil and gas,” Jagdeo told a news conference on November 23. “Our production is about to overtake theirs.”
The global energy crisis saw the re-emergence of Venezuela’s oil and gas industry, dragging the country out of more than a decade-long economic slump. Soaring crude prices saw Caracas reaping growing benefits for its economy; the country has managed to significantly boost its output.
However, it is still a far way from where production once stood. The country has the world’s largest proven crude reserves – 298.4 billion – and once pumped a whopping three million barrels per day.
“They had a thriving oil and gas sector that they destroyed much to the detriment of their people. It is a kind of jealousy,” Jagdeo posited.
By 2027, Guyana oil production is expected to hit 1.2 million barrels per day (bpd), making it the second largest producer in South America, after Brazil, based on current output across the region. The country’s lone producer is a consortium led by U.S. energy giant ExxonMobil. The company recently started producing at a third project offshore Guyana.
Venezuela increased its aggression towards Guyana when the country released the results of its first oil auction. It escalated to a December 3 referendum Venezuela will be holding that is fixated on the annexation of the Essequibo region.
The Venezuelan government has criticized Guyana’s decision to hold a licensing round for offshore oil blocks in areas Venezuela covets. Accusing Guyana of violating international law, Venezuela warned against any “illegitimate exploitation” and promised to “apply all necessary measures” against companies taking part in the bid.
Industry analysts believe that the threats would not drive away investors. Guyana is also forging ahead with finalising negotiations with winners of the auction.
