Guyana’s Vice President, Dr. Bharrat Jagdeo, told participants at the Offshore Technology Conference’s (OTC) inaugural Executive Dialogue Series held on Tuesday in Houston, Texas, that the South American country must have a share in the 4-trillion-dollar oil and gas industry. He pointed out that many activists critical of the country pursuing development of its hydrocarbon resources would in fact like to see the investments remain in the hands of the big players.
The Vice President described as ‘unfair’ the calls by some for Guyana to ‘leave the oil in the ground’ in support of net-zero by 2050 efforts.
“There are many others who have been globally saying that to get to a decarbonized future, to get to net-zero by 2050, there should be no further investments in oil and gas assets,” Dr. Jagdeo said. “So, what is our position on this? We believe it’s totally unfair.”
He said despite efforts to cut emissions and embrace the Paris Agreement, the world is not doing enough to keep global temperatures at 1.5° rise above pre-industrial levels, and the demand for energy is far outstripping the investment for renewables.
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“So, the world will need to use fossil fuels even if the transitional fuel is gas, as we get into that future. So, the people who are calling for us not to develop an industry in a small country like Guyana… We cannot remain locked into a cycle of low carbon emissions but low income,” he stated.
Legitimate expectation to prosper
Dr. Jagdeo, a former President of Guyana, said there is a legitimate expectation on the part of the Guyanese people that they should prosper.
“Guyana’s per capita income is now $6,000. Our people have a legitimate expectation of prosperity too. The United States is 70 odd thousand dollars per capita. The other developed countries are within that range or a little bit lower. So, we have a legitimate expectation to grow the per capita income, and rapidly too. This industry can contribute to that,” he pointed out.
Analysts have said Guyana is poised to rake in billions of dollars from development of its vast hydrocarbon resources now pegged at over 9 billion barrels of oil equivalent.
“If we freeze all new investments now in the oil and gas sector, particularly in countries like Guyana, there is still a 4 trillion-dollar industry – the oil and gas industry – that’s producing for the global demand. What these activists are doing, is they want to lock this investment in for the incumbents,” Dr. Jagdeo stated.
Pointing to the light sweet, low-sulfur content oil found off the country’s coast with breakeven prices ranging from $25 to $35 dollars per barrel, the Vice President said there is no reason why Guyana should not want to displace some of the higher cost producers.
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“We want to share in that market because if you don’t have any investments in small countries like Guyana or where the prospects are greater for cleaner – because it’s light sweet crude – and lower cost producers, then effectively we are lobbying for a monopoly for the existing producers,” he pointed out. “So, we believe that we can develop the industry in our country, it can grow rapidly, it can produce the wealth that could help us to change people’s lives and that’s crucial for us.”
Dr. Jagdeo said this can be done by using the oil and gas resources to invest in a decarbonized future consistent with Guyana’s Low Carbon Development Strategy, which will evolve.