Guyana, the Caribbean Community’s leading oil producer and exporter, is about to join the list of major producing countries globally as the country prepares to begin producing more than 1 million barrels daily.
The move to cross that threshold is coming when mega oil companies, like U.S.-owned ExxonMobil, are enjoying windfall profits from uncertainty in the world market linked to the U.S.-Iranian conflict in the Middle East, and to the problems supply ships are encountering when trying to navigate safely through the Strait of Hormuz controlled largely by Iran. Exxon is the main operator in a consortium with Hess/Chevron and CNOOC of China.
A large floating production, storage, and offloading vessel that will support the country’s fifth oilfield has already arrived offshore Guyana from its construction shipyard in Singapore, and is being hooked up and prepared to begin operations in the coming weeks.
Uaru is the latest oilfield to be thrown into production and it will produce around 250,000 barrels daily to add to current production figures of just over 900,000 barrels.
The oil and gas windfall, first discovered in May of 2015 with production commencing in late 2019, has turned the country into one of the world’s fastest-growing economies, triggered an unprecedented construction bonanza and an immigration rush that has quickly moved the national population from around 850,000 to an estimated 1.2 million today.
The 1-million figure, officials brag, will mean that Guyana will be the first in the 15-nation bloc to join the daily million-barrel club and perhaps the latest among producers globally to do so when production begins in the last quarter of 2026. Other regional producers include Trinidad, Suriname, Barbados, and Belize.
Suriname, which shares the so-called golden offshore basin with Guyana, is expected to begin production in 2028, while Trinidad appears set for a revival of its dwindling supplies when supermajor ExxonMobil begins appraisal of ultradeep acreage in the coming months.
Officials say that the trouble in the Middle East also means that the consortium has recovered its $50 billion-plus initial investment far faster than anticipated, helped by consistently higher oil prices. This development means that Guyana will now grab a much larger share of the production-sharing mechanism with the consortium partners, said President Irfaan Ali.
“Guyana’s share of oil has increased from 12.5% to 39.8%. This has occurred because the cost bank has been recovered two years earlier than originally expected. In terms of barrels, 75 of every 100 barrels produced went to cost recovery. Today, only about 20 barrels go to cost [recovery]. The US$55 billion expenditure was paid off. The cost bank is not saturated or entirely depleted, but the 20 barrels today account for operating and other costs. That which is left, which is called the profit oil, is split evenly between Guyana and the companies. Guyana’s half is about 39.8 barrels out of every 100. The companies’ matching 39.8 barrels is split three ways between the co-venturers,” the head of state told reporters.
As the consortium prepares at least three other large oilfields for production by 2030, Ali said the time for investment in a national refinery has come, because the country is reimporting refined oil that it had exported in the form of petroleum and lubricants, among other products.
“The global environment and imported inflation,” Ali said. “Now, look at what’s happening in the global environment. We produce crude oil, but we import all refined oil, our gasoline, and everything, so we import back all the price differentials. Since the war, you know what has been happening. We cannot have crude oil and don’t have security of supply … and security brings with it stability and then gives us some shield against shocks that are currently existing.”
The Guyana success story has sparked renewed interest and efforts by governments in the region to attract global companies to explore for oil and gas. These include Grenada, Barbados, and Jamaica, with Jamaica being ahead of the three since United Oil of the United Kingdom has announced the presence of hydrocarbons off the island’s south coast. The company is now trying to attract investors to take projects to the next stage.
Meanwhile, Barbados says two- and three-dimensional seismic surveys have indicated the possibility of up to 13 billion barrels of oil and up to 40-plus trillion cubic feet of natural gas.
On the other hand, Grenadian authorities have dismissed a Russian company that had drilled a single offshore well nearly a decade ago because of inaction, as there has been no activity since then.
