GUYANA’S economic development forecast for 2024 is off to a robust start, with exponential growth of 33 per cent recorded in 2023 and a stronger-than-expected expansion of 11.7 per cent in non-oil real Gross Domestic Product (GDP).

Minister of Finance, Dr. Ashni Singh in his recent presentation of the 2024 National Budget spoke to the overall economic growth in 2023 and credited this to the continued growth of oil and gas activities, which are slated to intensify in 2024 with the Prosperity FPSO expected to achieve production of 220,000 barrels per day by March.

This unprecedented growth was a result of several factors, the most notable being the Local Content Act, which increased the number of Guyanese hires in the industry and contract awards to local suppliers for the provision of services.

The implementation of the Act has spurred the creation of joint ventures and partnerships to support the industry, with many local businesses forming alliances to provide a range of services including shore bases, machining and fabrication services, offshore support vessel services, offshore helicopter services, offshore catering services and hazardous waste management.

As the industry continues to expand, more Guyanese are expected to support its operations. The Prosperity FPSO’s arrival and commissioning in the Payara field also contributed to the growth in the number of Guyanese supporting oil operations.
According to the minister, the oil and gas sector experienced exponential growth estimated at 45.9 per cent in 2023, with greatly increased production numbers that rose from 101.4 million barrels in 2022 to 142.9 million barrels of oil in 2023.

This growth can be attributed to the improved performances of the Liza Destiny and Liza Unity FPSOs, which recorded production numbers of approximately 142,000 and 235,000 barrels per day. As a result, the Natural Resource Fund received US$1,398.9 million in profit oil, US$576.6 million from Liza Destiny’s production and US$822.3 million from Liza Unity’s production, with US$218.1 million in royalties received from ExxonMobil Guyana.

To fund the government’s national development priorities, just over US$1 billion was withdrawn from the Fund and allocated to the budgets for the other sectors such as construction and education.

The oil sector also recorded an estimated 18 per cent growth in export earnings to US$11,631.5 million, contributing to an estimated 40.2 per cent surge in export volume. These figures reflect activities in the petroleum sector only and do not account for how the emergence of the sector impacted the growth of the other sectors of Guyana’s economic framework.

Meanwhile, the construction sector saw great expansion with the number of roads and infrastructural projects that were executed in tandem with the national developmental agenda, which was supported by revenue from the oil and gas industry.

A substantial increase in the demand for sand and stone was recorded in 2023, with 7.8 million tonnes of sand extracted across 31 legal operations. Overall, the construction sector is estimated to have grown by 26.6 per cent in 2023. The country saw an increase in import payments of 83.1 per cent.

According to the government, the Prosperity FPSO contributed approximately 26.6 per cent to total import payments for 2023.
It is projected that Guyana will experience real GDP growth of 34.3 per cent in 2024, which is primarily attributed to increases in oil production from the Prosperity FPSO. Once this project is achieved, the country will record its fifth consecutive year of economic growth exceeding 20 per cent each year. Additionally, the nation can expect the operationalisation of specialised subsea services in February through a joint venture between a local company and a Norwegian company.

Moreover, Guyanese can anticipate a paid internship programme from ExxonMobil Guyana’s Tier 1 contractors, under which approximately 100 paid internships will be offered. Other developments to further enhance the efficiency of the industry are the development of an enhanced digital platform to allow immediate notification of employment opportunities and procurement needs and local content sensitisation workshops to spread awareness of opportunities made available under the Local Content Act.

On the regulatory front, the government intends to carry out survey studies on the offshore blocks to better assess the potential petroleum resources available for development and production.
The discoveries of the Lancetfish-1, Lancetfish-2 and Fangtooth-1 SE wells in the Stabroek Block and the Wei-1 well in the Corentyne Block also contributed to the growth in proven resources.

With Guyana poised to become a leading provider in the global energy industry, the coming onstream of additional projects, such as Uaru and Whiptail will intensify the country’s production numbers, resulting in increased revenue earnings.

The non-oil sectors that were boosted by the demand from the oil and gas sector in 2023 are also projected to experience growth in 2024. While the services industry as a whole is forecast to expand by 6.9 per cent, the subsectors such as wholesale and retail trade and repairs, administrative and support services, information and communication, and transport and storage are expected to increase by 8.3 per cent, 8.6 per cent, 12.9 per cent, 8.2 per cent respectively.

As the petroleum industry continues to grow, so do the prospects of Guyanese, particularly suppliers and businesses. 2024 promises to be a year of national growth and development and the benefits of the sector are expected to reach Guyanese far and wide, propelling the nation even further on its development trajectory.