‘It is crucial that Guyanese businesses and the citizenry educate themselves in preparation for the changes which will occur in the economy’ – PSC Chairman
Officials of Esso Exploration and Production Guyana Ltd (EEPGL), a subsidiary of ExxonMobil, on Tuesday briefed members and executives of the Private Sector Commission (PSC) on the company’s exploration activities in Guyana and on the results and findings of the LIZA 2 appraisal well.
The Liza 2 results confirmed the preliminary findings of its predecessor the Liza 1 that had found sufficient deposits of oil to develop and extract commercially. Recent data from the Liza 2 appraisal well and 3D seismic survey indicates that the discovery contains some 0.8 billion to 1.4 billion barrels of oil deposits. EEPGL estimates that production can be realized within five years and can be as much as 100,000 barrels per day from one Floating Production and Storage Offtake (FPSO) vessel of which two can be in place. EEPGL confirmed that the development of the Guyana’s Resource is feasible despite the levels of oil prices currently.
The Private Sector Commission, in a statement following the meeting, said it emphasized the importance of local content (utilization of local resources) and were assured by the officials of EEPGL that the local content in their operations globally averages between 75% to 95%. It was also highlighted that due to the nature of the operations being offshore and the high levels of technology being utilized, the direct labour footprint overall will be within the hundreds rather than in the thousands.
Chairman of the Private Sector Commission, Mr. Edward Boyer, noted that it is crucial that Guyanese businesses and the citizenry educate themselves in preparation for the changes which will occur in the economy when the country begins to receive significant revenues from oil. It is important that the sovereign wealth fund be established and managed professionally and that Guyana become a member of the Extractive Industries Transparency Initiative (EITI). These will facilitate the transparency in the allocation and use of revenues generated from the oil and gas sector.
The Commission said it was encouraged by the assurances of Minister Raphael Trotman, with whom they met earlier in the week also, that local content is a focus of the Government and that local content rules will be legislated. Minister Trotman also expressed the Government’s commitment to the creation of a Sovereign Wealth Fund for the management of oil revenues and its intention to seek membership of the Extractive Industries Transparency Initiative (EITI) by November 2016.
Other companies currently in the oil exploration phase in Guyana include ON Energy onshore and REPSOL, TULLOW Oil ANDARKO, RATIO Energy Guyana Ltd, CGX Resources and Mid-Atlantic Oil and Gas Inc offshore.