Guyana projected to earn US$1 billion from oil this year

Last Updated on Sunday, 4 September 2022, 0:52 by Denis Chabrol

Guyana is expected to earn US$1.1 billion from 13 lifts as its entitlement from the ExxonMobil-led consortium due to the Russia-Ukraine war, Esso Exploration and Production Guyana Limited (EEPGL), according to the Ministry of Finances mid-year report.

“Government is now projected to earn US$1.1 billion as revenue from the sale of our share of profit oil, and US$147.7 million in royalties in 2022, subject to the evolution of world market prices,” states the report delivered under the hand of Finance Minister Dr Ashni Singh.

The report states that Guyana is forecast to still receive 13 lifts of profit oil from the Stabroek Block this year, but the country was poised to cash in on higher world oil prices as a result of the conflict. “With the price of crude oil ballooning after the Russian invasion of Ukraine, NRF deposits are now projected to be 32.5 percent higher than the US$957.6 million projected at the time of preparing Budget 2022,” the report states.

During January to June 2022, Government had five lifts of profit oil from the two producing Floating Production Storage and Offloading (FPSO) vessels- three from Liza Destiny and two from Liza Unity. The report explains that in the first half of the year, Government received US$307 million as revenue from their share of profit oil and US$37.1 million in royalties. According to the document, the total balance, inclusive of interest income, at the end of June was US$753.3 million, after a withdrawal of US$200 million in the month of May.

The Ministry of Finance states that the petroleum sector expanded by an estimated 73.5 percent, with 34.6 million barrels of
oil produced in the first half of the year. This was the result of the commencement of oil production at the Liza Unity FPSO in February.

The mid-year report also says that Guyana recorded an overall real Gross Domestic Product (GDP) growth of 36.4 percent in the first half of the year, with the non-oil economy growing by 8.3 percent, reflecting Government’s supportive policy stance.

The outlook for the second half continues to be favourable. For the full year, real GDP growth in 2022 is now projected at 56 percent overall, and non-oil GDP growth at 9.6 percent, maintaining Guyana’s position of global leader in economic growth.