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Guyana produced 35,607 barrels of oil daily in December, the country’s Finance Ministry said, as quoted by Reuters, which added the government’s royalty on that production would be 2 percent.
Guyana is the newest entrant on the international oil market. It rose to industry fame after Exxon, in partnership with Hess Corp., made a string of discoveries off its coast that tapped reserves estimated at more than 5 billion barrels.
Commercial production began ahead of schedule. It was originally planned for the first quarter of this year, eventually reaching a daily production rate of 120,000 bpd. During the second phase of development of the Liza discovery, production should rise to 220,000 bpd. By 2025, total production from the Stabroek Block, according to Exxon, should be some 750,000 bpd.
Such a rate of production would turn the tiny Latin American nation sandwiched between Venezuela and Suriname into quite a large player on the international oil market. However, given the current price environment, the demand patterns and the chances of this environment becoming chronic, these production goals may not be hit when planned.
In the meantime, however, oil news from Guyana will draw traders’ attention: just when OPEC— or at least its de facto leader, Saudi Arabia—is cutting to the bone to keep prices from falling further, here comes a new producer with significant ambitions in oil production.
Guyana’s addition to the ranks of non-OPEC producers could speed up the demise of the cartel as the only trend-setter in global oil—a position already shaken by U.S. shale as well as Brazil, which also has lofty production goals for the future.
Back in 2000, the U.S. Geological Survey estimated the total reserves of oil and gas contained in the Guyana-Suriname Basin at up to 13.6 billion barrels of oil and 32 trillion cu ft natural gas. It will this year reassess the 2000 figures and chances are the recoverable portion of these reserves thanks to much more advanced extraction technology.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.