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Guyana’s oil find more massive than established – former T&T Energy Minister
“You may well have another North Sea at your doorstep,” said former Trinidad and Tobago Energy Minister, Kevin Ramnarine earlier this year. This was at a symposium hosted by the Guyana Oil and Gas Association (GOGA).
Trinidad and Tobago’s former Minister of Energy, Kevin Ramnarine
Commercial extraction of oil on the shores of the North Sea dates back to 1851; it continues today with new discoveries being made. The North Sea has several oil bearing wells claimed by the United Kingdom, Norway, Germany and the Netherlands.
Some may say that comparison between Guyana and the North Sea is inadequate but that is not so for this holder of a Masters degree in Petroleum Engineering.
Ramnarine noted that in the Oil and Gas Industry there is something called the “Creaming Curve”.
He said that a Creaming Curve presents the relationship between cumulative resource growth and the number of exploration wells drilled. Ramnarine said that the name comes from the fact that the biggest discoveries are normally made early in the basin’s exploration history.
He told those at the symposium that as time passes, remaining prospects will be smaller and have a lower probability of discovery. “It is my opinion that Liza is the beginning of things to come. More oil and gas will be discovered in Guyana’s waters.”
He continued, “I would say, too, that the Guyana/Suriname basin is in its early days of exploration. When I was a student, the US Geological Survey estimated that the Guyana/Suriname basin had the potential for 14.2 billion barrels of oil, so you may well have another North Sea at your doorstep.”
The former Minister presented a graph which shows the history of Trinidad’ oil production for the first 107 years.
He said, “In that period, we have produced 8.4 billion barrels of oil equivalent. At Independence in 1962, we had produced just over 1.0 billion barrels of oil equivalent. A barrel of oil equivalent is a way of representing natural gas production as oil production. What does that mean?
It means that the Liza discovery alone is 17 per cent of all that Trinidad and Tobago has produced in 107 years. Most of our hydrocarbon production has been natural gas, and most of that natural gas has been produced in the last 20 years.”
The United States Geological Survey ranks the Guyana Suriname Basin second in the world for prospectively among the world’s unexplored basins and 12th for oil among the entire world’s basins – explored and unexplored.
With this in mind, Ramnarine said that it is imperative that Guyana tries to “get it right” as the wealth, if managed correctly, can spell transformation. He said that the country has quite a few other nations experience to learn from and should actively put measures in place to ensure that it can secure money that is to be derived from oil.
Ramnarine also said that Trinidad and Tobago made the mistake of taking too long to establish its Heritage and Stabilization Fund which is that country’s version of a Sovereign Wealth Fund (SWF).
Two years away from when production is expected to begin, Guyana is still to finalize a draft policy that will be used to govern the establishment of a SWF. Many believe that in the absence of a SWF, membership to the Extractive Industry and Transparency Institute (EITI) and other key measures, Guyana does not stand a chance of real transformation resulting from oil wealth.
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