India has signed a 5-year cooperation agreement with Guyana in the field of hydrocarbons. The aim is to strengthen India’s energy security and seize opportunities in Guyana’s burgeoning industry.
This memorandum of understanding (MOU) establishes collaboration across the hydrocarbon value chain, which includes the procurement of crude oil and the participation of Indian companies in exploration and production activities in Guyana.
Likewise, the agreement will allow India to have a presence in the thriving hydrocarbon industry in Guyana , which has recently experienced important discoveries. The main objective is to diversify India’s oil import sources and improve its energy security by promoting bilateral trade and investments in this sector.
Guyana as a key player in India’s energy security
Guyana has emerged as a major oil producer, with approximately 11.2 billion barrels of oil equivalent, representing 18% of total oil and gas discoveries worldwide.
In addition to collaboration in the acquisition of crude oil and participation in exploration and production activities, the MOU covers cooperation in areas such as refining, capacity development, natural gas and the creation of regulatory frameworks. It also promotes collaboration on clean energy , including biofuels and renewable energy generation.
The agreement has an initial duration of five years and will be automatically renewed unless both countries object. India, currently, is the third largest oil importer in the world and is highly dependent on imports as around 85% of its oil consumption is imported. Therefore, it seeks to diversify its supply sources and obtain oil at more competitive prices.
Notably, in 2019 Guyana became the most recent country to start oil production, thanks to ExxonMobil and its partner Hess Corp , who began production in the Stabroek block. To date, these companies have discovered more than 11 billion barrels of oil equivalent in that area.
Guyana currently produces approximately 380,000 barrels of crude oil per day (bpd) and aims to increase this production to 1.2 million bpd by 2027. The International Energy Agency (IEA) has forecast that Guyana, along with the United States and Brazil, will lead growth in oil production and capacity expansion outside the Organization of the Petroleum Exporting Countries (OPEC) during this decade.
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Source: rionegro.com.ar
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