Inspenet, July 19, 2023.
A new report from the United Nations’ Economic Commission for Latin America and the Caribbean (ECLAC) projects that by 2035 Guyana will become the world’s fourth-largest oil producer , surpassing experienced producers such as Norway and Mexico.
ECLAC pointed out that the dynamism of the sector is based on the number of announcements of greenfield projects in the country.
Since its first discovery in 2015, Guyana has been increasing not only its oil reserves, but also its production and annual revenue.
According to the Financial Times (FDI) Markets database, investments in the sector in Guyana totaled US$8 million in 2020 , the first since 2013. In 2021, ads increased significantly to a total of US$33 million and in 2022 this figure exceeded US$10.033 million .
“All these investments were made in the initial phase (upstream) of the value chain. In an increasingly competitive hydrocarbons market, both in terms of price and carbon intensity, Guyana’s oil is highly competitive. Most of the resources extracted in the country are of the light variety, with low exploration costs and an intensity of emissions below the world average”, the report highlights.
According to Schreiner Parker, Rystad Energy’s senior vice president and head of Latin America, Brazil and Guyana have the ability to profitably produce oil at a cost of $35 per barrel , less than half the current price of a barrel. Compared to the world average of 26 kg of CO 2 equivalent emitted per barrel, both countries emit only 10 kg per barrel.
Parker emphasizes that Brazil and Guyana have prime barrels that the market will demand in the future, which underlines the economic importance of oil production for the country and its potential for productive development through the use of these resources. The report projects that by 2029, the aforementioned notion will earn oil revenues totaling $13 billion .
Guyana as a major oil producer
Guyana currently has two projects in operation: Liza 1 and Liza 2, which combined produce 375,000 barrels per day (bpd). Four more floats are anticipated to be added to production by 2027.
By the end of this year, the Payara project is expected to come online, with an approximate production of 220,000 barrels per day (bpd). Then, by the year 2025, the Yellowtail project is expected with a production of 250,000 bpd. Uaru is also expected to produce up to 250,000 bpd, followed by the sixth project, Whiptail, with expected output of up to 275,000 barrels.
ExxonMobil, the operator of the Stabroek block, aims to achieve production of 1.2 million barrels of oil per day by 2027, with six floating production vessels operating simultaneously. There is potential for up to 10 floating production vessels to develop the resource and further expansion of the sector is expected once Guyana’s first round of offshore licensing concludes.
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