Russia’s invasion of Ukraine foisted Europe to the top as one of the largest buyers of Guyana’s Liza and Unity Gold crude, said S&P Global Commodity Insights’ oil pricing and news expert Patrick Harrington.
“Until recently, the bulk of Guyana crude was going to the US and the US West Coast but in recent months, we have seen – especially after Russian sanctions, Europe has really been edging out the US West Coast as the primary export destination for Guyana barrels,” Harrington explained in a podcast on August 3.
It was the scramble to find alternate sources of energy to fill the vacuum left by Russia that forced Europe to look to markets like Guyana.
From its two offshore developments – Liza 1 and Liza 2 – Guyana produces Liza and Unity Gold crude.
According to ExxonMobil, Liza crude, from the Liza Phase 1 project, is characterised as being “light, low sulfur crude suitable as a general purpose crude oil and suitable for production of middle distillates and mogas.” It has a sulfur content of 0.58% and an API gravity of 32.0 degrees. Unity Gold on the other hand, from Phase 2, has an API gravity of 35.3 degrees and a sulfur content of 0.39%.
Light, sweet crude is highly sought after, as it contains low amounts of sulfur, which in turn, leads to a higher yield of refined products like gasoline, diesel fuel, and even plastics.
Aside from Europe, Harrington noted that there are a few interesting buyers on the list for Guyana crude – like Brazil.
“Brazil has been buying some Guyana crude which is counterintuitive because as Guyana’s production ramps up, Guyana’s and Brazil’s crudes would be really in head-to-head competition,” he said.
Guyana is expected to become the second-largest oil producer in South America after Brazil, with its oil production projected to reach 1.2 million barrels per day (bpd) by 2027. When it reaches this level, Guyana will surpass all other countries in the world in terms of oil production per capita.
