…expected to become world’s 4th largest offshore oil producer by 2035
Guyana’s oil earnings are projected to go from US$1 billion this year to US$7.5 billion by 2030, with the country expected to become the world’s fourth largest offshore oil producer in the world by 2035.
This was according to Schreiner Parker, the Senior Vice President and head of the Latin America division for Rystad Energy, an independent Norwegian consultancy specialising in energy research and market intelligence. Parker participated in a recent webinar, titled “Guyana Upstream: a Rystad Energy Industry and Country Benchmarking Update”.
At the time, Parker was making the point that Guyana’s emissions are in fact only half of the global average, while the country’s oil production outperforms almost 75 per cent of other global oil producers.
“If we fast forward to 2035, Guyana becomes the fourth largest offshore oil producer in the world at 1.7 million barrels per day of production outpacing traditional offshore provinces like Norway, the United States, the United Kingdom and Mexico,” Parker said.
According to Parker, Guyana will go from a frontier exploration player when oil was first found in 2015, to a top five global oil exploration and producing country, in the space of just five years. And with earnings of US$1 billion a year currently, he said Guyana is well positioned to be earning US$7.5 billion by 2030 and US$157 billion by 2040 – from just the Stabroek Block alone.
“The Guyana Government take, which we estimate will reach $7.5 billion per year by 2030, and again that $157 billion by 2040 cumulative. It is important to note that in these estimates we are only talking about the Stabroek Block. Guyana has an oil industry that is sort of less than ten years old and yet it is scoring materially higher than Mexico, which has an oil and gas industry that is more than 100 years old.”
“So, I think what we can really show here is that Guyana is taking the right steps to ensure that good governance is a staple of the development of the oil and gas industry and that the benefits of this resource will go to the Guyanese population who are, at the end of the day, the rightful owners of this resource.”
The oil-rich Stabroek Block is 6.6 million acres (26,800 square kilometres). Exxon, through subsidiary EEPGL, is the operator and holds 45 per cent interest in the Block. Hess Guyana Exploration Ltd holds 30 per cent interest, and CNOOC Petroleum Guyana Limited, a wholly-owned subsidiary of CNOOC Limited, holds the remaining 25 per cent interest.
So far, Exxon’s total investments in Guyana total GY$1.3 trillion on its own and over GY$3 trillion with its partners. Additionally, the joint venturers’ exploration and production plans up to 2025 will likely increase their investments to more than GY$6 trillion.
ExxonMobil has said it anticipates at least six projects offshore Guyana will be online by 2027, with developmental drilling having been recently started on the second one, the Liza Phase 2 project. Production has already started in the second phase, with the Liza Unity floating, production, storage and offloading (FPSO) vessel in operation.
The third project – the Payara Development – will meanwhile target an estimated resource base of about 600 million oil-equivalent barrels, and was at one point considered to be the largest single planned investment in the history of Guyana.
Meanwhile, the Yellowtail development, which will be oil giant ExxonMobil’s fourth development in Guyana’s waters, will turn out to be the single largest development so far in terms of barrels per day of oil, with a mammoth 250,000 bpd targeted.
The market value of the Natural Resource Fund (NRF), which is housed in the United States Federal Reserve, was US$753.2 million at the end of June. However, a portion of the money from the fund was transferred to the Consolidated Fund recently.
