BP Oil International a key link between world markets and Guyana’s lifts

GUYANA continues to show strong growth in key areas, and this bodes well for all sectors of the economy, not just the oil sector.
It was announced recently that Guyana’s Ministry of Natural Resources selected BP Oil International to provide marketing services for the country’s oil entitlement from the Stabroek offshore block. Guyana has chosen to receive its portion of the proceeds from the Stabroek Block directly in oil cargo.

The Natural Resources Ministry reported in August that it expected Guyana to receive around 12 lifts of one million barrels for 2022 as the country’s share of the profits and royalties from the Liza Unity and Liza Destiny production ships.

BP’s winning bid beat out 13 other companies including Abu Dhabi National Oil Company (ADNOC) of the United Arab Emirates and Stabroek Block partner, China National Offshore Oil Corporation (CNOOC).

BP Oil International will serve as a key link between the world oil markets and the cargo lifts expected from the Liza Destiny FPSO and Liza Unity FPSO over the next year. Under the agreement, BP will provide benchmark and performance comparisons and help the government understand the market behaviours and yields of the Liza Gold and Unity Gold oil that Guyana is producing. Aramco Trading Limited (ATL), a Saudi Aramco subsidiary, previously marketed Guyana’s oil on a one-year contract.

The sale of Guyana’s oil lifts is what has kept profits rolling in to increase the Natural Resource Fund (NRF), and this contract with BP is another example of how the oil and gas sector is helping to financially solidify the countries long-term outlook.

In a recent interview outlining the deliberations and selection of BP Oil International, Vice-President Bharrat Jagdeo emphasized: “[They] had a bid and BP came out as number one. There’s zero marketing commission. It’s a standard contract, to sell our oil for a year.”

“Most of the world doesn’t have what we have,” he said. This is a major step forward for the country’s oil and gas sector leading into 2023.
Right now, Guyana’s contracts with international oil traders to market and sell its oil has thus far proven to be a fruitful endeavour.

The terms of the new agreement with BP represent a substantially improved negotiating position as the country pumps out more and more oil, and a country that has matured in the process and procedure of being an oil-producing nation.

In the short term, Guyana will continue to contract with companies to market and sell its oil to world markets. However, down the road as Guyana builds its capacity, it can explore the possibilities of marketing its own oil if the opportunity presents itself.

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