During the second quarter ended June 30, 2022, Guyana’s Natural Resource Fund (NRF) recorded a profit of GY$266.04 million (US$1.28 million) solely due to interest earned on deposits, says manager of the account, Central Bank of Guyana.
During the quarter, inflows to the Fund amounted to GY$48.4 billion (US$232.16 million) comprising of profit oil – GY$44.01 billion (US$211.11 million) and royalties – GY$4.39 billion (US$21.06 million). These funds were deposited into the Natural Resource Fund Account held at the Federal Reserve Bank of New York.
Over the quarter, the bank explained in its latest report that the Federal Reserve increased its target range for the federal funds rate twice moving it from 0.25% – 0.5% to 0.75% – 1% and then again to 1.5% – 1.75%. As a result of these increases which caused the interest rate on overnight deposits to rise significantly, and a higher account balance, the Fund was able to earn a higher level of interest income on its overnight deposits than previous quarters. The GY$266.04 million (US$1.28 million) in interest income earned over the second quarter is more than eight times the interest of GY$31.57 million (US$151,412.05) earned during the previous quarter.
As at June 30, 2022, Guyana received revenue for 12 lifts of 1-million-barrel (approximate) oil cargoes as its share of profit oil, with two being received this quarter. It is expected that revenue from an additional 10 oil cargoes will be received in 2022. This is due to the addition of the Liza Phase Two project in February.
Since its inception, the Fund has received GY$177.14 billion (US$849.63 million) from twelve lifts of profit oil and G$21.28 billion (US$102.06 million) from royalties.
To date, over 30 discoveries have been made offshore Guyana in the Stabroek Block.
In this oil-rich concession, the Liza Phase One development began production in late 2019 and reached its peak capacity of 120,000 barrels per day (bpd) in December 2020. The project was later optimised to produce up to 140,000 bpd.
Production from Liza Phase 2 began in February 2022 and has almost reached capacity of 220,000 bpd later this year.
On September 30, 2020, the Government of Guyana announced its approval of the Payara Offshore Development Project.
With an estimated resource base of approximately 600 million oil-equivalent barrels, production of up to 220,000 bpd is expected to begin late 2023.
Plans are in order for ExxonMobil’s 4th project – the Yellowtail Development project – which is expected to start production of 250,000 bpd in 2025 taking Guyana to a production level of 810,000 bpd.
It is projected that by 2027, six projects will be in operation and that by the end of the decade, Guyana’s oil production will increase to more than 1.2 million bpd.