Guyana, a country located on the northern coast of South America, has rapidly emerged as a significant player in the global oil industry.
Here are the key reasons why Guyana is positioning itself as a major oil producer:
1.Rapid increase in production: Since starting oil production in 2019, Guyana's output has surged to 645,000 barrels per day (b/d) by early 2024, primarily from the Stabroek block, according to EIA.
This makes it one of the fastest-growing non-OPEC producing countries, with an average annual increase of 98,000 b/d from 2020 to 2023.
2.Significant economic impact: The surge in crude oil production has been a major driver of Guyana's economic growth.
In 2022, Guyana recorded a 62.3% increase in GDP, the highest real GDP growth globally for that year, as per the International Monetary Fund (IMF).
3.Vast reserves: Recent estimates suggest Guyana has over 11 billion barrels of recoverable oil and natural gas resources.
These resources are located offshore within the productive Guyana-Suriname basin in the Atlantic Ocean, indicating significant potential for further exploration and development.
4.Major discoveries and development projects: The first significant oil discovery offshore Guyana was made by ExxonMobil in 2015 at the Liza project in the Stabroek block.
Since then, over 30 additional discoveries have been made, pointing to a promising future.
Currently, oil production is facilitated by three floating production, storage, and offloading (FPSO) vessels.
Plans are underway to expand production capacity to about 1.3 million b/d by the end of 2027 with three additional projects: Yellowtail, Uaru, and Whiptail.
5.Geopolitical challenges: Despite its success, Guyana faces challenges, notably Venezuela's sovereignty claim over the Essequibo region.
However, the International Court of Justice (ICJ) has ruled that Venezuela should not disrupt the status quo while the dispute is being adjudicated, which supports ongoing operations.
Guyana’s ascent in the oil industry
Guyana’s ascent in the oil industry is not just a story of economic opportunity but also of strategic advancements and geopolitical navigation.
As the country continues to develop its oil resources, it is set to become a key figure in the regional energy landscape, potentially ranking as the second-largest crude oil producer in Central and South America after Brazil.
This remarkable growth offers profound opportunities for all levels of the oil and gas industry, from platform workers to executives, all contributing to a vibrant sector.