Guyana’s Natural Resource Fund (NRF) received a substantial sum of US$1.6 billion in royalties and profit oil revenues for the year 2023, as reported by Senior Minister with responsibility for Finance and the Public Service, Dr. Ashni Singh. This is a result of oil production operations being conducted by ExxonMobil under a Production Sharing Agreement (PSA) that governs the prolific Stabroek Block.
The breakdown of this revenue is notably from two key sources: the Liza Destiny oil production unit contributed approximately US$576.6 million, while the Liza Unity accounted for about US$822.3 million. In addition to these profit oil payments, the NRF also benefited from royalty payments amounting to US$218.1 million. These royalties, which come from the co-venturers in the Stabroek Block, represent 2% of the value of the crude produced and sold.
These revenues are in line with the production output from three offshore projects, which collectively yielded 142.9 million barrels of crude in 2023. As a result of these contributions, the NRF’s total receipts for the year reached $1.617 billion. By the close of 2023, the NRF’s net value stood at $1.975 billion, according to the December report from the Bank of Guyana, albeit slightly lower than the projection made at the start of the year by the Ministry of Finance.
The production performance of the three offshore projects varied, with the Liza Destiny averaging about 141,000 barrels per day from January to November. The Liza Unity averaged 234,000 barrels per day in the same period. The Prosperity floater, the newest addition to Exxon’s lineup, began production in mid-November 2023 and quickly ramped up to 100,000 barrels per day by the end of that month. Collectively, these projects achieved a production rate of 500,000 barrels per day. Following this, in early January, ExxonMobil announced an increase in production offshore Guyana to 550,000 barrels per day.
This surge in production has led to a 45.9% expansion of the oil sector in 2023. The year’s total production marked a substantial increase from the 101.3 million barrels produced in 2022.
In 2023, there were a total of 142 lifts of crude oil from the three FPSOs, each lift representing approximately one million barrels. Of these, 17 lifts were allocated to the government, including six from the Liza Destiny and 11 from the Liza Unity. The profit oil receipts in 2023 correspond to two lifts from the last quarter of 2022 and 15 government lifts in 2023. Additionally, two receipts related to 2023 are expected in January 2024 for lifts that occurred in December 2023.
Under the current framework of Guyana’s Natural Resource Fund Act, approximately US$1.15 billion of the 2023 inflows are earmarked to support the 2024 national budget. However, the government plans to revise the withdrawal rule in the NRF, aiming to increase the fund’s contribution to the budget. This change is motivated by the fact that the projected expenses for 2024 are about 47% higher than the 2023 budget.
