Govt. conniving with Exxon to hide Guyana’s oil reserves from nation – OGGN

Feb 25, 2024 ExxonMobil, News, Oil & Gas

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…calls for updates within a month of discovery

Kaieteur News – As Guyana approaches the two-year mark without an update on its discovered oil reserves in the Stabroek Block, from American oil giant, ExxonMobil, stakeholders are calling for a timeline to be set in which the resource update can be made public.

The Oil and Gas Governance Network (OGGN) an overseas based group of Guyanese, focused on transparency and good governance of the country’s natural resources, in a letter to this publication on Saturday argued that Guyanese deserve to know the value of their resources.

OGGN members, Alfred Bhulai, Andre Brandli, Kenrick Hunte, Darsh Khusial, Joe Persaud and Charles Sugrim reasoned that Guyana’s oil reserves in the Stabroek Block have not been updated for almost two years now, since April 2022. The last estimate publicly shared was some 11 billion barrels of resources.

The group highlighted that during the first years of offshore exploration, the operator of the Stabroek Block provided progressive updates of estimates of the total petroleum reserves after every discovery, beginning with 1 billion barrels in May 2015. Since April 2022 however, seven announcements of oil discovery were made with no update on the Stabroek Block reserves.

OGGN pointed out that its members are well aware of the fact that calculating reserves is the simplest of tasks, performed soon after the exploratory well(s) is/ are drilled. To this end, they concluded that government was conniving with the oil company to hide the nation’s oil reserves.

They said, “Notwithstanding being abetted by the Government, Exxon plays the Guyanese people for dummies to believe that this oil reserve calculation is so complicated to require years…why, and what kind of Government would want to connive with a foreign company to hide our god given wealth and the amount in our bank account?”

The concerned Guyanese urged government to release updated figures on the total energy reserves within a month of a new oil discovery.

OGGN pointed out, “To date, there have been a total of 33 announcements of oil discoveries in the Stabroek Block. Hence, approximately 20% of the oil discoveries are not included in the estimate of 11 billion barrels of oil equivalents associated with Guyana’s offshore oil reserves.”

They said that the Guyanese policy makers for the oil sector are openly standing on the side of Exxon by hiding the new discovery figures. “These folks seem to forget they were elected by their citizens to serve the interests of Guyanese, not those of Exxon shareholders. There are many other instances where it is clear that entities in the Government of Guyana are siding with Exxon,” the Network noted.

For instance, OGGN argued that government has joined forces with Exxon to fight against Guyanese, who are demanding that Exxon cover all costs associated with an oil spill; has allowed the company to produce oil 35% above the legal safe operating limits, increasing the chance of an oil spill and has secretly changed permits to triple deployment time of the capping stack (i.e. equipment which stops a well blowout) from three to nine days, allowing for a potential extra six days of oil gushing into the ocean.

They also pointed out that the government has altered environmental permits for the dumping of oil-contaminated, toxic and radioactive water into the ocean, instead of following the international standard of reinjecting back into the ground and changed the permits to incentivize Exxon to make money from flaring by paying a paltry fee that is miniscule compared to the money lost from not flaring.

OGGN explained, “We have had at least seven major discoveries (since 2022) … if the first 26 major discoveries totalled 11 billion barrels, then the average discovery contains about 423 million barrels of oil. If we multiply 423 million barrels by seven, then we assume approximately 3 billion barrels of reserves are being hidden from the public.”

In other words, the Network said that if the 3 billion barrels is calculated at $80 each, it would mean that as much as US$240B in potential revenue is being hidden from the Guyanese people. “To put that in perspective, when oil production started in 2019, the national budget for that year was about US$1.5 billion. The recently passed 2024 budget is US$5.5 billion, which still only amounts to about 2% of the unreported oil reserves, we are anticipating. Therefore, OGGN requests the Government of Guyana to update the total offshore oil reserve figures by including the last seven major discoveries made since 2022, now!”

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• conniving, ExxonMobil, OGGN, oil, reserves, update

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