Extractive Industries Transparency Initiative (EITI), ExxonMobil, Guyana-ExxonMobil Profit Sharing Agreement (PSA), Guyana’s oil and natural gas development, Oil and natural gas industry, Petroleum (Exploration & Production) Act, Sovereign Wealth Fund (SWF), US Energy Governance & Capacity Initiative
ExxonMobil Country Manager Rod Henson receives Production License
from Minister of Natural Resources Raphael Trotman
Georgetown – Guyana – June 15, 2017
Photo Credit: Guyana Ministry of Natural Resources
On June 15, 2017, Guyana tied the knot with ExxonMobil with the signing of a production license for the extraction of oil and natural gas, located offshore the Caribbean/South American nation with a population of 800,000 people. With this license, together with the Environmental Permit granted on June 1st, ExxonMobil will proceed with the Liza Phase 1 development. Located 120 miles offshore in an area known as the Stabroek Block, the Liza field development includes a subsea production system and a floating production, storage and offloading (FPSO) vessel designed to produce up to 120,000 barrels of oil per day. Exxon and its partners plan to begin production by 2020.
ExxonMobil’s press release on June 16th states: “Phase 1 is expected to cost just over $4.4 billion, which includes a lease capitalization cost of approximately $1.2 billion for the FPSO facility, and will develop approximately 450 million barrels of oil.
It is a marriage of unequal partners. ExxonMobil’s profit margin in 2016 is more than twice that of Guyana’s GDP of US$3.5 billion for the same year. With the assistance of local and foreign experts in the industry, the Guyana government has reviewed the Production Sharing Agreement (PSA), signed in 1999 when exploration began under the former leftist Guyana government. Continue reading