Venezuela tensions are set to ease, resulting in a rise in the oil production potential of Guyana
Experts in geopolitics and oil said that the tiny oil-producing country of Guyana, which is already one of the fastest-growing economies in the world, has a window for expansion due to the ongoing U.S. activities in Venezuela.
The growth potential of the oil and gas industry will be at the forefront of a four-day conference beginning Tuesday in Georgetown. Government officials and executives will discuss how to increase investment, build an downstream sector, and train local workers.
The oil promise of Guyana has been a hot topic for years. However, the events in Venezuela have brought the region into the spotlight after U.S. troops removed Venezuelan president Nicolas Maduro last month. U.S. president Donald Trump has called for $100 billion in investment to reactivate Venezuela’s oil sector.
This development could ease the burden on a
long-standing border dispute
Exxon Mobil and the Guyanese Government halted?exploration on about 30% of Stabroek Block.
Henry Ziemer is an associate fellow with the Center for Strategic and International Studies. He said that the chances of a political flare up between the two countries are low, at least for the moment. "It removes foreign investment's biggest barrier."
He said, "If there is any country that benefits the most from Maduro being removed, it's probably Guyana." Exxon CEO Darren Woods stated last month that the capture and removal by the U.S. of Maduro could?lead better operating conditions in Guyana. The top U.S. oil company operates the Stabroek Block with Chevron, China's CNOOC and Chevron as minor partners. Woods stated that "perhaps we'll be able to see an opportunity in less naval patrols, which will make it a bit more friendly."
Potential for more exploration
The International Court of Justice of the United Nations is overseeing court proceedings over Guyana's and Venezuela's border disputes. A final decision may take many years but any detente would help lift the force majeure placed on a part of the Stabroek Block?located within disputed waters? and encourage new exploration. The consortium increased its oil production in Guyana last year to over 900,000 barrels a day. A new project that will be developed this coming year will increase?production up to 1,15 million bpd.
Since Exxon discovered oil in Guyana, the country has grown to become one of South America's leading oil producers. This is despite Venezuelan oil production stagnating. Exxon executives will be expected to provide updates on operations in Guyana, including an extensive gas plan for power generation.
The company's CEO, Mike?Wirth, will make his first official appearance on Tuesday. This comes after Exxon and the U.S. Oil Producer?acquired 30% of the Stabroek Block in a long legal battle. The company believes that the oil and natural gas resources in Guyana are'more than 11 billion barrels of oil equivalent currently estimated by Exxon. It is eager to assist with additional exploration. Woods, Exxon's Woods, was asked to comment on Chevron's remarks in an interview from November. He said that the company had a fiduciary duty to update its resource estimation when it had new information. We don't yet have any updates to the resource estimate, despite all of our work.
(source: Reuters)
