Guyana’s oil is a high priority for Exxon

Feb 04, 2024 ExxonMobil, News, Oil & Gas

Expert says: it is one of the greatest giants to be found in a long time and there may never be another Guyana’s oil is a high priority for Exxon

Kaieteur News – International Energy Advisor David L. Goldwyn recently described the 11 billion barrels unlocked in the Stabroek Block as one of the “giants” of the industry, adding that it is for this reason the country is a “high priority” for American oil giant ExxonMobil.

International Energy Advisor, David L. Goldwyn

During a recent interview with CNBC, the world’s leading network for business and financial news, Goldwyn said, “For all of the international oil and gas companies, they look for big finds and Guyana is the biggest that anyone has found in a very long time and there may not be other giants as they are called in the business that are left so it is extremely important.”

The analyst added, “And I think that is why you see Exxon place such a high priority not only on the development of the asset but on the development of the country because for international companies these are 30-year projects, and they are going to be there for a very long time. So, if the country does not succeed, neither do they.”

While Guyana may be a high priority for Exxon, Goldwyn said it is critical that authorities put systems in place to avoid the dreaded resource curse.

He said that while a Natural Resource Fund (NRF) is a good place to start to avoid this curse, the analyst said it should not be perceived as a “silver bullet” or panacea. The industry expert said, “In order for Guyana to avoid the curse they need to get to the next level. First, they have a NRF, but they need independent management of that fund as Norway has.” He said too that Guyanese authorities need to have a long-term view on investments and avoid wasting that money.

Another key mechanism he said is for the government to improve its capacity to manage oil and gas and all other sectors that will see expanded growth as a result. He noted for example that Guyana needs to strengthen its abilities to manage very large procurements such as billions that would be allocated for roads and other critical infrastructure that the country needs. Goldwyn said governments are not always inclined to go that route as it is not politically popular.

He said nonetheless that “without that government capacity, (proper) accounting, and budget supervision, they are going to have a hard time managing that money well.” The energy expert also underscored the need for Guyanese authorities to channel some of the oil capital to the people who need it.

Overall, Goldwyn said the foregoing would be crucial to helping Guyana keep the resource curse at bay. For readers unfamiliar with the term, the resource curse describes the circumstance where a country does worse off with the discovery of a resource in significant quantities. In simple terms, the people are not better off with its discovery. While Goldwyn and others have expressed concerns about the country’s ability to avoid the resource curse, local authorities have insisted that the work is being done to avoid this pitfall.

Vice President and Chief Policymaker for the oil sector, Bharrat Jagdeo has said the government is determined not to become overly dependent on oil revenues, adding that a portion of the wealth is being used to ensure the country has a diversified economy. He said this is being done with key investments channeled to health care, education, infrastructure, agriculture, manufacturing, and energy transformation.

CNBC, David L. Goldwyn, Exxon, International Energy Advisor, Natural Resource Fund (NRF)

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