Guyoil earns $18B in first half of year

Aug 09, 2017 News

The Guyana Oil Company (Guyoil) Limited has earned revenues to the tune of $18 billion in the first half of 2017. This represents an increase of 11.8 percent when compared to the same period last year.
According to the Ministry of Finance, the increase in revenues is primarily due to additional receipts from debtors which rose by 23.1 percent to $9.2 billion.
The Finance Ministry also explained that expenditure rose in the first half of 2017, and was 28.8 percent higher than the first half of 2016.
This, it said, is primarily due to increased payments to creditors. As a result, Guyoil recorded an overall deficit of $247.3 million, a 73.1 percent decline compared to 2016.
The Finance Ministry noted that anticipated declines in local sales put the revised forecast for revenue at $37.6 billion, down from an original budget of $38.9 billion for 2017 while expenditure is projected to decline marginally.
Altogether, Guyoil is expected to post a deficit of $328.4 million from an originally projected surplus of $813.1 million.
Finance Minister, Winston Jordan has often spoken of Guyoil’s creditable performance over the years. At a time when a large number of public enterprises have become extinct, Jordan has noted that Guyoil stands out like a financial beacon in an ocean of economic woes by those that have remained. Jordan noted that Guyoil has always enjoyed an operating surplus.
He opined that many may scoff at this achievement, claiming that it is a ‘buy and sell’ company. But, in the context of the trials and challenges experienced over the last 40 years, Jordan said that this is no easy feat. He noted that in 1980, Guyoil sold oil valued at $49 million.
Jordan related that by 1996, the twentieth year of its establishment, Guyoil had spent $2.7 billion to realize sales of $3.9 billion. After honoring all of its expenses, Guyoil realized a profit of over $400 million. Jordan said that this trend has been maintained, with sales soaring to $44.3 billion in 2013.
Jordan said, “In terms of volume, our fuel consumption has changed remarkably. Whereas, in 1994, we consumed 363,340 barrels of fuel, comprising mogas, kerosene, gasoil, fuel oil and lubricants, by 2015, this had risen to 1,316,875 barrels, driven largely by the explosion in the mining and transportation sectors.
I may add that these numbers do not capture other fuel importers in the system.”
He continued, “With the difficult task of mobilizing savings and other resources to finance our Good Life programmes, I am heartened by Guyoil’s contribution to the national coffers, over the years. Indeed, during the last fiscal year, Guyoil contributed over $2 billion in taxes and dividends to the central government revenues, making Guyoil easily the largest contributor among the public enterprises.”
In addition to the impressive statistics and achievements, the Finance Minister said that Guyoil has been able to keep prices below those of its competitors and has developed a reputation as a reliable supplier of quality products.
He noted, however, that it is important for all to bear in mind that lowering dependence on oil is an ecological necessity, and a technological challenge which Guyana’s economic policy cannot side step.
The economist said that this is why the government is developing strategies for a “green” economy. These strategies he said, will in the long run, lessen the dependence on imported fossil fuels while diversifying the nation’s energy mix.
While government continues to explore options for renewable energy, Jordan said that improved energy efficiency should not be overlooked. The Finance Minister noted that improved energy efficiency offers a means of facing the country’s challenges head on.
He said that Guyoil is an important component of the country’s national energy system and given its significant economic linkage, the entity can be used as a platform for socio-economic development while redefining the country’s energy landscape.

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