Understanding Energy | Delays could risk long-term value of Guyana’s oil
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OUR new government has vowed to be a friend to Guyana’s business community and extract as much value from Guyana’s oil as possible. But this pro-business stance increasingly is coming under fire from well-funded environmental groups based abroad.
International environmental activists appear to have the ear of certain local media outlets and local and vocal oil industry critics and contrarians. They argue that Guyana has time on its side and that delaying projects such as Payara indefinitely is actually good for Guyana’s leverage. But there is a real risk to this gambit that many activists sometimes avoid admitting publicly.
As the new government prepares the national budget, it is important to reflect on Guyana’s financial position. Many of the government’s budget plans rely on the significant revenues expected from the oil sector. That makes it all the more urgent that Guyana’s oil is actually produced, so that critical needs sch as improved infrastructure and better education can be met soon.

The international environmental groups and commenters pushing for delays in Guyana generally insist they just want the best deal for Guyana—the implication being that delays are only meant to help Guyana get the best value from its oil. But some of their statements appear to indicate other motives. Activist Melinda Janki, one of the most prominent of these voices, clearly stated in an opinion published last year that “the last thing the world needs now is new oil from Guyana.”

Few Guyanese companies would agree. They have already made major strides in joining the emerging oil industry. More than 600 were employed by the Stabroek Consortium at last count and more than half of the 3,500 workers supporting oil development are Guyanese.
And many oil-market experts see the demand for oil starting to fall within the next few decades as countries shift to renewable sources. That includes many of the most prominent advocates of Guyana stalling its own oil development. There is no guarantee that oil prices 10 or 20 years from now will be higher than they are today, or that global agreements to limit climate change won’t make development much more difficult.
That makes long-term delays very risky, especially ones that could have cascading effects in slowing subsequent projects.
Although that contradiction is rarely acknowledged by the most outspoken opponents of Guyana’s oil development, it’s worth noting. At a certain point, Guyana’s oil could be a “use it or lose it” proposition. That’s why holding up projects as leverage, as some have suggested, could hurt the country in the long-term more than help.

With the vast majority of Guyanese strongly in favour of oil development and the billions of dollars in revenues it will bring, it’s critical that Guyanese recognise thinly veiled anti-development arguments for what they are. Getting as much value out of this resource as possible is a noble goal, but keeping the oil in the ground is simply not an option for most Guyanese.

It will always be in the best interest of Guyana to have a thorough review process and ensure development proceeds carefully. And we should continue to keep a careful eye on the actions of the companies operating here to ensure that Guyana’s best interests are represented.
But the same goes for foreign anti-oil activists who would love for us to abandon the best chance this country has to provide for future generations to further their “keep-it-in-the-ground” campaigns. Guyanese are right to be wary.

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