By Ivelaw Lloyd Griffith
This is a two-part series on Guyana’s petroleum pursuits and the likely impact of climate change dynamics on those pursuits. In this first article, we look at oil production and note some of the climate change circumstances at play.
The heavy rainfall and significant floods in Cuba, Haiti, Jamaica, and elsewhere in the Caribbean over the past few weeks are a harsh reminder of the arrival of this year’s Hurricane Season. Although Guyana is outside the Atlantic hurricane belt, the heavy rains there also are a reminder of the power and presence of Mother Nature. However, increasingly over the past few years the world has come to know of Mother Nature’s potency in Guyana not in relation to water, but in relation to oil.
Motherloads of Back Gold
Mother Nature has endowed Guyana with a motherload of black gold, making the nation that is geographically South American but culturally Caribbean the world’s newest oil-power-in-the-making. Guyana’s first offshore discovery was made in May 2015 in the Stabroek Block by a three-company consortium comprising two American oil giants—ExxonMobil and Hess Corporation—and an Asian company, the China National Offshore Oil Corporation.
During his 2023 Budget speech on January 16, Finance Minister Ashni Singh noted that the year 2022 was an exploration banner year: 11 new wells were drilled, 10 of them alone in the now famous Stabroek Block, which extends over 6.6 million acres (26,800 square kilometres) of maritime space. The new discoveries brought the total discoveries to 40, with 35 in the Stabroek Block alone. There was another discovery in January 2023, in the Fangtooth SE-1 well, which was followed in April by one in the Lancetfish-1 well, both wells being in the Stabroek Block.
Guyana’s proven oil reserves now stand at 11 billion barrels equivalent, ranking at number 17 worldwide, just after Algeria and ahead of Mexico. The Cooperative Republic currently produces nearly 400,000 barrels per day, which is expected to soar to 600,000 barrels a day next year once the latest floating production storage and offloading (FPSO) vessel, Prosperity, is fully operational, and just over one million barrels per day before the end of the current decade. The quality of the oil also is noteworthy; it is light and sweet, emitting fewer emissions during the refining process and commanding higher prices.
Evidently, Guyana is on the verge of becoming extraordinarily rich. Respected energy analyst Arthur Deakin from Americas Market Intelligence is convinced that “Per capita, Guyana will become the largest producer of oil in the world, passing the likes of the United Arab Emirates (UAE) and Kuwait. Oil revenues could approach US$30 billion dollars a year by 2030, roughly three times the size of both countries’ GDPs …combined.” Thus, Mother Nature’s bounty will catapult South America’s only English-speaking republic into a new and powerful geopolitical league within and beyond the Americas. Indeed, the country’s new exalted status undoubtedly contributed to its success earlier this month in its quest for a U.N. Security Council seat. Guyana will serve from January 1, 2024, through December 31, 2025.
Yet, oil is not Mother Nature’s only endowment; water is too, because Guyana is in a Wet Neighbourhood, with physical and social geography features that help set the stage for the creation of environmental security conditions. I proposed the term “Wet Neighbourhood” in a March 2020 report for the Center for Strategic and International Studies to describe Guyana’s tenuous geographic and environmental realities. Water is virtually in Guyana’s DNA. As a matter of fact, the word Guyana itself is an indigenous Indian term meaning “land of many waters.”
Guyana has 965 miles of navigable rivers snaking through its 83,000 square miles, and 270 waterfalls. One of them, the majestic Kaieteur Falls, is 226 metres high and has the distinction of having the world’s largest single drop waterfall by the volume of water flowing over it. In addition to the numerous rivers, waterfalls, and lakes, a contributor to Guyana’s Wet Neighbourhood is the fact that 87% of the country is forested, according to the Rainforest Foundation US, with a significant portion of the forestation being in the Amazon rainforest. As well, the country’s coastline is a major—and troubling—aspect of its Wet Neighbourhood. It runs 285 miles along the Atlantic Ocean and is six feet below sea level in some places.
This Wet Neighbourhood nation relies on several measures to protect it from the fury of the Atlantic Ocean. One is a coastal wall, construction of which dates to 1855 during the time of British rule. Regrettably, maintenance of the Sea Wall has been inadequate over the years, with overflows from the ocean becoming a regular occurrence.
Wet Neighborhood realities aggravate the country’s environmental security vulnerability, especially because the capital, Georgetown, lies along the coast, and because about 80% of the country’s population lives in coastal cities, towns, and villages. So, the nation has had to cope with flooding for a sizable part of its modern history. The most destructive flood over the last few decades occurred in January 2005, when the country suffered the highest recorded rainfall since 1888, affecting about 84% of the population and causing an estimated US$500 million worth of damage. The country experienced severe flooding again two years ago, when seven of the 10 administrative regions were heavily impacted, prompting President Dr. Mohamed Irfaan Ali to issue a national disaster declaration and pronounce the situation as the worst natural disaster in the country’s history. Like clockwork again this month, Georgetown and other parts of Guyana are under a deluge.
Sea Level Rise
The Wet Neighbourhood situation also is affected by other climate change realities, such as sea level rise. A study by the Union of Concerned Scientists (UCS) in 2011 noted that “the Guyana coast is subsiding owing to groundwater extraction, soil compaction, and drainage of wetlands. From 1951 to 1979, sea level off Guyana rose at a rate some six times the global average, (0.4 inch, or 10.2 millimetres per year), around six times the twentieth-century average or three times the 1993 to 2009 annual average.”
For several reasons, the situation has worsened since the UCS study, though. Indeed, this past February, scientists at Climate Central, an independent group of climate experts, named Georgetown to its list of 15 cities around the world likely to be inundated at high tide by 2030 because of the effects of global warming.
Coastal flooding in Guyana affects more than just its capital. Importantly, too, the flooding and sea level rise, manifestations of the country’s Wet Neighbourhood, have considerable implications for the nation’s environmental security, the subject of attention in the next article in the series.
About the Author
Ivelaw Lloyd Griffith, a former Vice Chancellor of the University of Guyana, is a Fellow with the Caribbean Policy Consortium and Global Americans. His next book, Challenged Sovereignty: The Impact of Drugs, Crime, Terrorism, and Cyber Threats in the Caribbean, will be published by the University of Illinois Press.