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Guyana to receive current world market price for oil sold to India – Minister
Kaieteur News – According to Minister of Natural Resources, Vickram Bharrat, the recent sale of one million barrels of Liza crude to Indian Oil Corporation Ltd. (IOC) is set to be the country’s highest paying oil deal to date.
Natural Resources Minister, Vickram Bharrat.
Responding to questions posed by the media, the Minister indicated that the government had invited ExxonMobil, Hess, CNOOC and IOC to indicate interest in purchasing the shipment via the submission of proposals. He noted that “of the four, we would have gotten the best deal from the Indian Oil Company; that is why we decided [on them] and that is how we will continue to function, that is to say, ensuring we get maximum benefits from the oil and gas sector, and this is what we will continue to do.”
With the Brent crude oil, the index Guyana uses to sell its crude oil trading at more than US$75 a barrel, the 75,000,000 estimated price for the most recent shipment of Liza crude would firmly place it as the highest paying oil sale for Guyana’s oil to date, raking in an almost US$3,000,000 or a 20.7 percent increase over the previous highest sale of 62,100,000. In relation to this, the energy minister said that “you could recall the last payment was US$62.1M so this is a significant increase.”
In noting the highly favourable terms of the million-barrel deal with IOC, the Natural Resources Minister revealed that no marketer’s fee is included in the transaction. He said, “what is important to note too, is that for this last lift we are not paying any marketing fee. You are just selling the oil to the Indian Oil Company and they are transporting it.” Consequently, the minister has touted this as “the sweetest deal we have had thus far.”
According to the Bank of Guyana, the most recent account details a figure of US$344,161,633 (GYD71,585,619,000) in Guyana’s Natural Resources Fund. The estimated sum for the most recent shipment could carry that figure to almost US$420,000,000 (GYD85,570,000)
The nation’s seventh oil shipment bound for India has been regarded as a trial shipment undertaken as part of an arrangement seeking to establish a long-term agreement between Guyana and India. Eighty percent of India’s gas demand is satisfied by oil imports which makes it the third largest oil importer in the world. The nation’s gas demand is expected to increase nearly three-fold from 229 million metric tonnes in 2018 to 607 million metric tonnes in 2040.
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