When ExxonMobil’s Yellowtail Development Project at the Stabroek Block comes on stream in 2025, Guyana will be producing over 800,000 barrels of oil per day. One analyst who has been following the Guyana oil story closely says this is a significant milestone for any country, especially one with a population of just over 750,000 people.
Putting the production into a global context, Arthur Deakin, Co-Director of Energy at Americas Market Intelligence (AMI), told OilNOW Yellowtail will propel Guyana to the position of being the 23rd largest oil producer in the world and the 4th largest in Latin America based on 2020 volumes. What is more astounding he posited, is the fact that Guyana would become the largest oil producer per capita in the world in just four years.
OilNOW reported recently that the Yellowtail development is targeting 250,000 barrels of oil per day, the largest volume yet for a single development offshore Guyana.
Yellowtail’s 250,000 bpd will add to the 120,000 bpd from Liza Phase 1, 220,000 bpd from Phase 2 of the Liza Development and 220,000 bpd from Payara, ramping up total production to more than 800,000 bpd.
This massive level of oil production will generate hundreds of millions of U.S. dollars in revenue for Guyana. Deakin reiterated the need for authorities to ensure these sums are managed in a transparent manner that will ultimately benefit the South American country. He said this is going to require the establishment of an independent body/committee to oversee the oil money saved in the Natural Resource Fund (NRF) while adding that the creation of a Public Oversight and Accountability Committee, populated by people chosen from an international oversight body, would be ideal.
Since oil production began in December 2019, Guyana has received over US$240 million in revenue from the export of just over 5 million barrels of oil. Inclusive of royalties the total in the NRF account now exceed US$267 million (GY$55 billion).
However, according to the Bank of Guyana’s 2021, Q1 report, there remains no investment mandate for the Fund. It reminded that a letter from the former Minister of Finance dated June 8, 2020, stated that pending the constitution of the Investment Committee and preparation of the Investment Mandate, all petroleum revenue should be held as cash deposits in the NRF account.
Newly elected President, Dr. Irfaan Ali has been adamant that the oil revenues will remain untouched until a framework is developed that allows for the funds to be managed in a more transparent manner with less authority being vested in the Minister of Finance.
“The oil revenue must be used to 1) strengthen existing opportunities in our country and 2) to open up new opportunities for investment, new opportunities for economic growth, new opportunities for social development,” Mr. Ali told reporters earlier this month.