Latest update January 10th, 2025 5:00 AM
Latest News
- Jagdeo-led PPP supported tax waivers to Exxon without seeing terms of oil contract
- President stomps Nandlall’s plan to appeal $24M awarded to Quindon Bacchus’ family
- More than 46,000 Palestinians have been killed in the Israel-Hamas war, officials say
- Benn flags citizens lax approach to fire safety
- Chinese man missing after falling off new harbour bridge
Investment in infrastructure will prepare Guyana for post oil economy – Jagdeo
Vice President, Bharrat Jagdeo
Kaieteur News – Chief policymaker in the oil and gas sector and Vice President (VP), Bharrat Jagdeo told the media last Thursday that the investment the government is currently making in infrastructure will prepare the country to sustain its economy after oil has been exhausted.
The Minister of Natural Resources recently disclosed that the projects currently producing may very well be exhausted before 20 years given the ramped up production by operator of the Stabroek Block ExxonMobil. Following the disclosure, it was a concern voiced by citizens; what will happen to Guyana after oil is finished. This publication asked the VP if when oil is exhausted, will Guyana continue to borrow loans to finance the country’s development like they are doing today?
Saying that the question should be posed to the opposition, Jagdeo questioned, “So you are saying, don’t build the power plant now, don’t build the other infrastructure now?… Cause a lot of this infrastructure that we’re putting in is not just a social nature (but of an) economic nature.”
He explained that the power plant will facilitate lower rates for electricity and will therefore create the atmosphere to move further into the manufacturing sector. Building more farm to market roads and processing facilities like tissue culture labs will allow for further progression of the agriculture sector. “So you have to plan for the day when oil is no longer available or does not generate the same sort of income that it will generate say about three years from now because we are not at peak revenue from oil as yet,” he added.
He boasted that all of these things are ways the government is preparing for the economy post oil and gas, and, this is something that they would have said to the opposition. Going back to the time when he was President Jagdeo disclosed that he had spoken to three Prime Ministers to see what measures they were putting in place to upkeep their citizenry after oil, however he does not feel that anything significant was done to diversify the economy there. Hence, the country ended up having a major welfare loss because of this.
“So we are determined not to find ourselves in a situation like that, that’s the first point. So from day one, we are working for long-term sustainability so that you can generate income from other sectors to sustain the growth in prosperity,” he said.
Minister of Natural Resources, Vickram Bharrat has admitted that oil from the three projects currently in operation could be depleted ahead of the 20-year lifespan due to the optimization of production at the Floating Production Storage and Offloading (FPS) vessels. Bharrat, during a news conference, was asked by this newspaper to explain how the optimisation works could affect the 20-year estimated project life for each of the developments. Bharrat explained that while the oil at a specific project could be depleted before its estimated lifespan, it was also possible for the projects to produce beyond this time.
He said, “Yes it can finish before the 20 years or it can even go beyond because as a reservoir matures, you can get more out of it and then as we have more discoveries, we can add those wells to the existing development too.”
Bharrat pointed out that ramping up oil production has now become a trend in oil-producing states since this could prove more financially viable for a country – in this case, Guyana. According to him, “Ramping up production and producing the oil in a reservoir at a faster time than you can is actually good for a country because it comes back to the window that is available for fossil fuel to survive and the price that will be available.” He explained that the market would be crowded with suppliers even though the demand would go down. Consequently, he noted, “So if you have this large supply of fossil but a small demand, the price will go down so much that it will make no sense for countries to produce oil and gas anymore.”
Similar Articles
THE BLUNT OF THE DAY
Sports
Features/Columnists
The unconscionable terms of the PSA establish a case for renegotiation
The unconscionable terms, The unconscionable terms Peeping Tom… Kaieteur News- The Production Sharing Agreement (PSA)... more
Forget Begging Rich Nations: Caribbean Countries Should Act to Save Themselves
By Sir Ronald Sanders Kaieteur News- It has long been evident that the world’s richest nations, especially those responsible... more
Weekend Cartoon
