— as earnings projected to reach US$4B annually with operation of four FPSOs

WITH ramped-up oil exploration and extraction activities slated for the coming years, Guyana seems to be well on its way to realising its potential as the Dubai of the Caribbean and South American regions.

This was the indication given by Minister of Natural Resources, Vickram Bharrat, during a recent engagement with petroleum news website, OilNOW.

Minister Bharrat said that Guyana’s petroleum sector could begin to facilitate 50 oil lifts per year, at one million barrels per lift, thereby producing 50 million barrels of oil annually.

These increased lifts, the minister indicated, are possible with the intended arrival and operation of three additional Floating Production Storage and Offloading (FPSO) vessels. These include the Liza Unity, which is expected to arrive in November; the Prosperity FPSO which is currently under construction; and the Yellowtail FPSO which is slated to come on stream by 2026.

Further, with crude prices hovering at US$80 a barrel, Guyana would earn as much as US$4,000,000,000 (GYD$836,902,800,000) each year for its 50 oil lifts.

Minister Bharrat also predicted that with the country’s eighth oil lift due next month, Guyana could earn some US$150M between the two if oil prices remain around US$85 per barrel.

“So, when you crunch the numbers, 50 lifts at a million barrels, and based on the oil price today, if it continues along that trend, you can see or get an idea of the direct proceeds coming to Guyana,” Minister Bharrat related.

He also reminded that the aforementioned earnings are outside of other benefits such as royalties, which could see a mammoth increase in the country’s overall oil earnings. “We are not even talking royalties yet,” Minister Bharrat emphasised.

To this end, he said that Guyana “could comfortably close the year with close to US$600 million in the Natural Resource Fund.

Minister Bharrat reasoned that these earnings are coming at a time when Guyana is being serviced by only one FPSO. “Now imagine, this is just what we are earning from the Liza Destiny alone; that is our small FPSO; that is our baby,” Bharrat said.

He added that when the Liza Unity FPSO arrives within the next two weeks from now, “we will be getting 220,000 barrels of oil per day and instead of five lifts per year, we would be getting perhaps 10 to 12.”

Additionally, he said that when the Payara Development Project comes on stream, the country would benefit from yet another 10 to 12 oil lifts per year. “That is in total close to 30 lifts per year with Liza Destiny, Liza Unity, and Prosperity,” Minister Bharrat noted.

Moreover, by 2026, the operations of the Yellowtail FPSO will increase the annual oil lifts to approximately 50. “The proceeds from oil and gas will be mind-blowing,” Bharrat surmised.

To paint an even clearer picture, it was explained that oil proceeds will be twice the 2021 national budget by 2026, which totalled $383 billion.

Since 2015, Guyana has had 22 oil discoveries, and with the country poised to gain far more within the coming years, the government has promised that the oil revenues will be used to bring direct benefits to the people of Guyana.

As it is, more than US$400 million is sitting in Guyana’s Natural Resources Fund, untouched. The People’s Progressive Party/Civic-led government has vowed to ensure that the monies are only spent once the requisite legislation is in place to ensure intense scrutiny and accountability of spending.

Additionally, Vice-President Dr. Bharrat Jagdeo had previously indicated that with the climate- change imperative to decarbonise the world, it was important that Guyana pursues an aggressive mission of “getting as much oil out of the ground as quickly as possible.”

The former President, at an oil conference in the United States, reasoned that Guyana has to maximise the benefits from the industry and use those benefits to change the life of every Guyanese.

“We don’t know how swiftly we’ll get to a decarbonised world, but we have to make use of this period when there is still demand to get as much as possible out of the ground and that is why we support the rapid pace of the industry, but it must be done safely,” he posited.