Part 3: Guyana’s Golden Gateway to Economic and Energy Security

Ahead of this week’s February 14-17, 2023 Guyana Energy Conference and Expo, this four-part series follows the original search for Guyana gold five centuries ago that preceded the 21st Century oil rush that’s fueling the Cooperative Republic’s fortunes into a golden future!

THE historical information in Parts 1 and 2 of this series was sourced exclusively from the online information provider Wikipedia.

But the unending El Dorado legend has many other extensions; and although neither the fabled man, city, kingdom or Empire of Gold were ever found, the name continues inspiring movies and stories in the 21st Century.

And it’s a popular name too for villages, towns and cities across The Americas and Caribbean, also adopted by bars, tourism and entertainment facilities.

Guyana’s gold (in its interior) always attracted diggers from across the Caribbean and neighbouring Brazil, French Guiana and Venezuela over long decades, illegally panning for the precious metal, just like their predecessors did.

But the arrival in Guyana of the giant Canadian-owned Omai Gold Mine in the 1990s changed the state of play, creating the largest gold extraction operation in South America, producing over 3.5 million tons between 1993 and 2005.

ExxonMobil started drilling in the early 2000s and by 2015 started entering into agreements for continuity in Guyana, where the payload below its waters is a vast and endless new ocean of subterranean (liquid and gas) energy.

The Stabroek Block – being drilled by a consortium comprising US-based ExxonMobil and HESS and including China’s National Offshore Oil Company (CNOOC) — is today uploading endlessly from the Guiana Basin, with plans on fast-track for production of one million barrels per day (bpd) by 2027.

Stabroek is 6.6 million acres (26,800 square kilometers) large, with its gross recoverable resource now estimated at more than 11 billion oil-equivalent barrels from successful exploration wells.

Guyana’s offshore fields are estimated to have potential resources of more than 25 billion barrels and estimated reserves of over 11 billion barrels.

But already, even though the boom has just started, oil resources, reserves and revenues have transformed one of the poorest nations in the Caribbean and continental South America from a junior player on the global energy market in 2020, to the world’s fourth-largest oil producer and supplier in 2023.

The government, earlier this month, withdrew US$200 million from the Natural Resources Fund (NRF) – mainly contributed to by taxes, royalties and other payments from the investing companies – as its first draw-down for 2023, to finance national development priorities approved in the recently-approved US$3.7 billion 2023-2024 national budget.

Some US$607.6 million was withdrawn last year to finance projects and the National Assembly also approved US$1.002 billion to be transferred during the current fiscal year.

The government also aims to increase the nation’s share in its new-found wealth through royalties and sale of 14 new oil blocks next month, at prices between US$10 million and US$20 million, to increase the national stake in local energy this year, from 14.5 per cent to 27 per cent.

Guyana will also be one of 65 nations offering blocks on the global platform in May, expanding its base as a new global energy player.

For decades derided as the Caribbean’s “most resource-rich, but dirt-poor nation”, Guyana today continues to attract global, regional and domestic interest while pitching for investments from both North and South, including new American, Canadian and European firms, as well as from Africa, China, India, Gulf and other Arab states, while cooperating with oil-producing neighbours Brazil and Suriname.

In mid-January 2023, ExxonMobil and Hess both announced finding more oil and intentions to build new rigs, the first of which has also arrived to drill the first well owned by Canada’s CGX; and CNOOC launched a $10 million fund for University of Guyana scholarships.

On Tuesday (February 14), a four-day 2023 Guyana International Energy Conference and Expo (ending February 17) will be held at the Georgetown Marriott hotel, the third in an annual series also supported by Suriname.

The main address will be by Professor Jeffrey Sachs, Director of the Center for Sustainable Development at University of Columbia, a former United Nations advisor, well-known, highly-experienced and globally respected for his vast knowledge and understanding.

He will address the conference theme Harnessing Energy for Development and can also be expected to draw the interesting links between Big Oil, Small Nations and Huge Hopes.

President, Dr. Irfaan Ali says aggressive exploitation of the Caribbean region’s natural gas potential is needed to ensure Caribbean energy security and the Caribbean Development Bank (CDB) – which will also attend the conference — is showing strong interest in financing energy projects in Guyana, which CDB President, Dr Hyginus ‘Gene’ Leon, says, “has every right to all the benefits it can earn” from its Oil and Gas resources.

The CDB also aims to help attract more regional involvement in opening-up Guyana’s golden energy gateway.

Delegates started arriving for the conference over the weekend, including 20 new Canadian companies.

According to Canada’s High Commissioner to Guyana, Mark Berman, “They are not all oil and gas, as there will be some others, including renewables and tech companies… involved in the energy sector.

Meanwhile, ExxonMobil, which posted record global profits of US$56 billion in 2022, says it sees “greater potential for further expansion” in Guyana in 2023, with eyes on the new oil blocks to be auctioned in March.

ExxonMobil’s Guyana President, Alistair Routledge, says: “We’re always interested in new acreage, and, clearly, where we’ve had some success, it brings a certain degree of interest, and we should be knowledgeable on it. We’ve registered for the bigger end.”.

Clearly, thanks to its emerging energy revolution and the prudent management of the sector, as its new High Commissioner to Canada, Keith George, said recently, “Guyana has transitioned from A Land of Great Potential to A Land of Promise!’

NEXT SUNDAY: A Rearview Review in Fast-Forward!