Every year, Guyana’s oil and gas sector seems more monumental than the last. Lots of watershed moments are expected in 2025. Guyana will take its place as the world’s largest per capita producer of crude oil.
Here’s what to look forward to:
Commissioning of Gas-to-Energy project and advancement of phase 2
The commissioning of the US$2 billion Gas-to-Energy project may be the biggest event of 2025. Guyana has historically been plagued by one of the highest costs of power in the region and an unstable supply, impacting the cost and quality of living, as well as the investment climate. Government says Gas-to-Energy and its associated investments will allow it to slash the cost of power by 50% and reduce emissions from generation by replacing heavy fuel oil with natural gas as the source. Exxon is expected to deliver 50 million cubic feet per day to shore through a pipeline. Aside from domestic power generation of 300 megawatts (MW), the project will yield about 4,000 b/d of NGLs for 20 years.
Government invited proposals for a second phase of onshore infrastructure. Exxon will be expected to expand the transport of gas to shore from 50 to about 125 million cubic feet per day. The onshore infrastructure is envisioned to be similar to the first phase, increasing power generation to 550 MW and NGL production to 10,000 b/d. The government sees a two-year period as reasonable for the completion of this phase. The National Procurement and Tender Administration Board (NPTAB) will open proposals for phase 2 on January 14.
CLICK HERE to read more about the landmark Gas-to-Energy project.
Arbitration
- Gas-to-Energy
A U.S. group, CH4-Lindsayca, is building an integrated facility at Wales, including a power plant and natural gas separation plant. Disagreements between the government and the contractor over costs and timelines for the project resulted in the filing of multiple claims. Vice President Bharrat Jagdeo said arbiters could hand down a resolution in January.
- CGX and Frontera’s Corentyne Block license
Faced with a refusal by the Guyana government to extend their time with the Corentyne Block, CGX and Frontera are preparing to take the next step. The duo had applied for approval to appraise their Wei-1 discovery, but the government is not convinced they can gather the funds for the program or find a capable partner.
The joint venture said last December that they sent the government a letter, activating a 60-day period to resolve the dispute over this matter via negotiation. If that fails, the Corentyne license gives them the right to move for a resolution through arbitration or a sole expert.
- Chevron’s Hess acquisition and a coveted 30% Stabroek Block stake
As Chevron prepares to close its Hess acquisition of Hess, its face-off against Exxon over a 30% stake in the Stabroek Block is set to culminate this year.
Following Chevron’s announcement of its agreement to acquire Hess in 2023, Exxon and CNOOC raised a dispute, arguing that they have pre-emption rights to Hess’ 30% stake in the Stabroek Block before Hess could be sold to Chevron. Chevron and Hess believe the pre-emption clause in the Stabroek Block joint operating agreement does not apply to their merger. A resolution is expected in 2025.
Increased oil production
- Yellowtail start-up
The Yellowtail project, Exxon’s fourth Guyana oil development, is on track for first production in 2025. Exxon said the ONE GUYANA floating production, storage and offloading (FPSO) vessel is due to arrive in the second quarter. It will boost production capacity offshore Guyana by 250,000 b/d.
- Production boost at Liza 2
The Liza 2 project has demonstrated it can sustain production at 250,000 b/d, above the design basis of 220,000 b/d. Exxon believes that after additional debottlenecking in 2024, the project can produce 270,000 b/d. The increase awaits regulatory approval.
Crude oil production capacity offshore Guyana will exceed 900,000 b/d in 2025.
Exploration
- Orinduik Block
Eco (Atlantic) Oil & Gas, the sole owner of the Orinduik Block license, has said it plans to drill one exploration well at the Orinduik Block in the first half of 2025. Two targets – Kumaka and Iatuk – were floated in Eco presentations, but no concrete decision has been made public. The company has also been engaged in a farm-out process to bring in a larger partner before drilling.
- Stabroek Block
ExxonMobil has a “healthy inventory of drilling prospects” for the Stabroek Block. In 2025, this exploration is expected to continue. This is likely to include additional focus on gas prospects and appraisals, as Exxon works to streamline plans for its potential first standalone gas development.
Finalization of gas development roadmap, word from Exxon on potential gas project
The Ministry of Natural Resources has engaged S&P Global to guide the development of a gas monetization strategy for Guyana, likely to be completed in 2025. ExxonMobil Guyana President, Alistair Routledge, said it will have a clear understanding of the way forward for Stabroek Block gas by early 2025. It may partner with U.S. start-up Fulcrum LNG, which Guyana identified for that purpose. Fulcrum could also move forward with a project alone if Exxon is not interested.
Review of Exxon’s Hammerhead application
ExxonMobil is expected to submit its Hammerhead environmental impact assessment (EIA) and field development plan (FDP) to regulators in the first quarter. The project will target oil production at a rate of 150,000 b/d, taking total production capacity offshore Guyana to more than 1.5 million b/d by 2028.
Commencement of Longtail application
ExxonMobil has named Longtail as its eighth planned oil development for the Stabroek Block. Based on its 2018 Longtail-1 discovery, the project will target production at a rate of 240,000 b/d, starting in 2030. As is customary for such projects, Exxon must apply to the Environmental Protection Agency (EPA) for environmental authorization and the Ministry of Natural Resources for a production license. It will have to contract an environmental impact assessment (EIA) and compile a field development plan.
Legislation: Local content, oil spills, health and safety
The groundbreaking Local Content legislation that rakes in hundreds of millions annually for Guyanese companies, is due for an update in 2025. Vice President Jagdeo said last November that companies that are non-compliant with the spirit of the law will have a lot to worry about, as the government plans to close several loopholes. Additionally, the first schedule of the Act includes 40 categories of goods and services from which companies in the sector are mandated to procure to varying extents. The administration is expected to expand this list based on consultation with the private sector.
The Ministry of Legal Affairs is drafting a National Oil Incident, Emergency Response, and Financial Responsibility Bill. The bill will deal with the management of and financial responsibility for oil spills and environmental damages from petroleum activities, among other things.
Work also started on Health and Safety Regulations for the petroleum sector.
Completion of audit of Exxon’s 2021-2023 expenses
The Ministry of Natural Resources awarded a US$1.5 million contract to Guyanese group VHE Consulting to audit Stabroek Block expenses incurred by ExxonMobil, Hess, and CNOOC, in the period 2021-2023. Specifically, the services include a cost recovery audit and validation of the Government of Guyana’s profit oil share. This audit is expected to conclude in 2025.
Submission of Guyana’s 2023 EITI report
Guyana plans to submit its Extractive Industries Transparency Initiative (EITI) report for the fiscal year 2023 in the first quarter of 2025, way ahead of the December 2025 deadline. The government is keen to do better after the country was temporarily suspended in 2023 for late submission of its 2020 report. Guyana joined the EITI in 2017, two years after the first discovery of commercial crude offshore. The country has committed to producing reports with a comprehensive view of government revenue and associated information, concerning the sectors of oil and gas, mining, forestry and fisheries.
Completion of CGX’s Berbice port
CGX Energy’s Berbice logistics yard and port facility is due for completion in 2025. The company said operations at the facility began in the fourth quarter of 2024. It expects the full cargo terminal aspects of the port to be completed in the first half of 2025, and operation of the oil and gas support base in the second half, subject to construction schedules, financing and supply chains. The project’s completion has been hampered by delays, much to the frustration of Guyana government officials. The oil industry and the Berbice economy are expected to be key beneficiaries of the project.
ExxonMobil’s move into its new Ogle headquarters
The US$160 million complex is due to enhance the management of ExxonMobil’s Guyana operations. Originally meant to move over in 2024, staff currently stationed in Georgetown are expected to move to Ogle this year. The headquarters, including an offshore command center, can house more than 500 persons.
Guyana’s fourth year spending oil revenue
Government will draw from various sources to support its 2025 national budget, including its Natural Resource Fund (NRF). The Fund, which receives royalties and oil sales revenue, contributed US$1.6 billion to its 2024 budget. The law governing the Fund will allow for an expansion of the annual withdrawal by half this year to US$2.3 billion. The money is expected to allow for investments into continued infrastructure expansion—roads, bridges, energy plants, schools, hospitals, and housing.
Venezuela submission to ICJ in Essequibo case
Guyana submitted a legal brief to the International Court of Justice (ICJ) in its territorial case with Venezuela. Venezuela is expected to make its own submission, as court proceedings advance.
The case centers on the 1899 Arbitral Award, which legally determined the boundary between the two countries. Venezuela, after accepting the boundary for decades, declared the award null and void in 1962 and has since claimed over two-thirds of Guyana’s territory in the Essequibo region. Guyana initiated legal proceedings at the ICJ in 2018, following UN Secretary General António Guterres’ determination that judicial settlement was the best path forward. The ICJ subsequently ruled it had jurisdiction over the case in 2020, rejecting Venezuela’s objections.
Award of contract for seismic study to prepare for second auction, potential model oil contract revision
Four bids were submitted in October from companies shortlisted for a contract to conduct a 3D seismic survey offshore Guyana. The purpose of this is to make available, high-quality seismic data for effective evaluation during future licensing rounds.
The Guyana government may also revise its model contracts before its second auction. Vice President Jagdeo has said negative feedback came in about punitive measures in the current model documents, including from ExxonMobil.
Guyana Energy Conference and Supply Chain Expo 2025
Guyana’s biggest annual energy forum, the Guyana Energy Conference and Supply Chain Expo, returns February 18-21, 2025 at the Marriott Hotel, Kingston. Themed ‘Connecting the Dots: Integrating the Future,’ the event is expected to attract over 5,000 delegates, feature more than 180 booths, and host over 70 distinguished speakers, including regional and international Heads of State, industry experts, and innovators. Key topics will include supply chain optimization, the role of women in energy, and building workforce for the future. ExxonMobil is the title sponsor.
