Wednesday, July 6, 2022

‘Guyana is best growth opportunity seen in Latin America past 30 years’ – Energy group

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With discovered oil resources of over ten billion barrels, low breakeven costs of $25-$35, and a light sweet crude, low in sulfur that emits fewer greenhouse gasses, Managing Director of Americas Market Intelligence John Price, says Guyana is the best growth opportunity seen in Latin America in the last 30 years.

These remarks were made on Wednesday when the Latin American strategic market research firm held a webinar on identifying opportunities and advancing low carbon strategies in Guyana and Suriname’s petroleum sectors.

During the virtual event, the firm’s Co-Director of Energy Practice Arthur Deakin reminded that 20 per cent of the ten-billion-barrel reserve is gas and added that AMI sees Guyana becoming a gas exporting hub for the Caribbean Community (CARICOM).

This position was shared by the Director of CARICOM’s Energy Unit Dr. Devon Gardener, whom OilNOW reported as saying that Guyana, Suriname and Trinidad possess the capability to be the regional energy fulcrum.

With such a massive gas reserve, Deakin stated too that Guyana holds a “tremendous monetization opportunity”.

Meanwhile, the Co-Director of Energy went on to say by 2035, Guyana has the potential to become the largest per capita oil producer in the world and grounded this on a projection of Guyana’s production levels. He said Guyana could be producing 1.4 million barrels of oil per day by the aforementioned year.

Notably, ExxonMobil is sparing no efforts to aggressively develop its projects offshore, as the oil giant is moving ahead with its fourth development, Yellowtail, in the Stabroek Block. Already, the operator of this oil block has discovered over ten billion barrels of recoverable oil and by the end of this decade, it intends to have ten floating, production, storage and offloading (FPSO) vessels in the lucrative offshore concession.

The first project at Liza One is already on stream with a nameplate capacity of 120,000 barrels of oil per day. All three of Exxon’s announced upcoming projects have nameplates each above 200,000 barrels per day, with the highest being 250,000 at the Yellowtail development.

With just four projects, ExxonMobil would be producing over 800,000 barrels of oil per day by 2025, making AMI’s projection plausible.

Participating in Wednesday’s discussion as well was the former Guyana Ambassador to the United States, Riyad Insanally, who recognized that while there is a lot of excitement about the oil finds, apprehension is also displayed.

“There is apprehension about resource curse,” the diplomat said, “low population size, brain drain has spanned generations, and we lack institutional, human and technical capacity.”

He was quick to note, however, that the government recognizes these concerns and is working to address them.

“They want to provide cheap power, diversify the economy and pursue a low carbon development strategy. In Guyana, we were moving to improve the regulatory framework. The government recognizes the need to have a more robust system, and this is why it is moving to establish the Petroleum Commission, strengthening the Environmental Protection Agency and other regulatory bodies.”

Equally important, Insanally pointed out, is for the government to prudently manage the revenues that inflow from Guyana’s oil and gas resources. He applauded the administration for moving to amend the laws governing the Natural Resources Fund (NRF) which now make it harder for politicians to manipulate.


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