August 15, 2022
Bobby Gossai Jr
The Stabroek Block is expected to produce some 93.6 million barrels of oil equivalent (BOE) for 2022 and of that amount Guyana will get an estimated 12 lifts of one million barrels each, according to the Ministry of Natural Resources.
“Crude production for 2022 is estimated at 93.6 million barrels,” Senior Petroleum Coordinator within the ministry, Bobby Gossai Jr said in response to questions from the Stabroek News. Gossai Jnr did not say or estimate how many barrels from that amount would be government’s take but instead forecast that government, “will receive twelve lifts of profit oil entitlement”.
Gossai Jnr explained how Guyana’s ‘entitlement’ of the 93.6M BOE was arrived at from the two respective FPSOs – the Liza Unity and the Liza Destiny. “The Government of Guyana received three (3) lifts of profit oil from Liza Destiny FPSO for 2022 thus far, and is expected to receive another three (3) lifts during the remainder of the year. The Government of Guyana received three (3) lifts of profit oil from Liza Unity FPSO for 2022 thus far and is expected to receive three (3) lifts during the remainder of the year,” he informed.
ExxonMobil had said that Liza Unity’s FPSO compressor was replaced and that the new one is functioning ‘optimally’, producing 140,000 Barrels Per Day [bpd], some 20,000 bpd beyond its stated maximum. Environmentalists and others, including former head of the Environmental Protection Agency, Dr. Vincent Adams, have expressed disquiet over this new 140,000 bpd production target from Liza Unity. They have continuously and consistently argued that this platform, originally designed for 120,000 bpd maximum, should not be allowed to produce beyond that figure as the FPSO can be susceptible to heightened risks.
ExxonMobil, however, has rejected these arguments. Last month the company said that background flaring as required by the 60-day period outlined in the Liza Phase 2 Environmental Permit had been achieved on the Liza Unity FPSO and that the vessel’s production had reached its production target of 220,000 barrels per day (bpd). The Liza Unity commenced operations in February of this year. The combined offshore production within the Stabroek Block as of now stands at 360,000 barrels per day, even as this country prepares for a third FPSO next year.
Closing balance
The closing balance as of the end of July 2022 of monies from oil proceeds in Guyana’s Natural Resource Fund stands at US$ 845.6 million. In July’s monthly report of the NRF, the Bank of Guyana stated that the account earned $10.646 billion in royalties and $50.127 billion in profit oil. This totals $60.773 billion. A total of US$607M is to be withdrawn this year, according to the laws that govern the fund. The first tranche, of US$200 million (equivalent to $41.7 billion), was withdrawn in May of this year.
Last month, Senior Minister within the Office of the President with responsibility for Finance, Dr. Ashni Singh indicated that pursuant to Section 16 of the NRF Act 2021, a further US$200 million equivalent to $41.6 billion was transferred from the NRF to the Consolidated Fund “to finance national development priorities.” The withdrawals to date from the NRF equate to US$400 million (equivalent to $83.3 billion).
Government now has a further US$206M eligible for withdrawal for the 2022 fiscal year. The NRF Act 2021 came into operation on 1st January, 2022, and as part of the Budget 2022 process, Parliamentary approval was granted for a transferral of US$607.6 million during fiscal year 2022, the release added.