Significant petroleum discoveries offshore Guyana by US super-major ExxonMobil has served to derisk the Guyana-Suriname basin, and in so doing, strengthen the South American country’s position for future negotiations.
The country’s Minister of Natural Resources, Raphael Trotman, told OilNOW on Friday that relative to current circumstances, Guyanese can expect a better deal going forward for the exploitation of petroleum resources.
“As the basin has been derisked and as new contracts are signed, we will seek to improve them to give a greater share to the government and the people of Guyana,” he stated.
Mr. Trotman said while the initial agreement between Guyana and ExxonMobil may not have been the best, experts have said it was fair, relative to the circumstances that existed then. The government, following the Liza world-class discovery, was also able to press for an increase in royalty from 1 to 2 percent.
Several companies are currently conducting exploration work offshore Guyana and interest continue to be shown by others.
As things currently stand, Guyana’s revenue stream from petroleum production includes 2 percent royalty and 50 percent of the profit oil, as well as withholding taxes, which the country is already receiving.
Going forward, Guyana will push for higher royalties and profits. “The royalty is no doubt going to increase and of course we will look to perhaps…greater profits or greater recovery…right now for example, 75 percent of every dollar goes to recovery, 25 percent goes to profit. We may adjust that,” Mr. Trotman said.
Several experts, he pointed out, are standing by to assist Guyana in future negotiations.