With the recent discovery of over 11 billion barrels of oil reserves off the coast of Guyana, this small South American country has become a hot investment destination for major oil companies. Key factors driving oil investment interest in Guyana include the country’s abundant reserves, favorable regulatory environment, and rapid development timeline from discovery to production.
ExxonMobil spearheads oil investment with multiple Guyana projects
ExxonMobil has taken the lead in Guyana oil investment through its Stabroek block projects. After making a significant discovery in 2015, Exxon fast-tracked development and started production at the Liza field in 2019. Additional sanctioned projects at Payara, Liza Deep and Yellowtail are expected to bring Exxon’s Guyana production to more than 1 million barrels per day by 2027. Exxon and partners Hess and CNOOC have plans for further development pending government approval.
Guyana offers attractive terms to draw more oil investors
A key factor attracting oil investment to Guyana is the favorable regulatory environment. Guyana has offered production sharing agreements with generous terms to companies willing to take exploration risk. Companies receive 75-90% of production depending on output volume, recover exploration costs from production, and pay a sliding scale royalty starting at 1% based on R-Factor. These attractive terms, combined with Guyana’s oil riches, provide exceptional investment returns compared to other frontier regions.
Guyana’s stability and infrastructure position it for long-term growth
In addition to abundant resources and welcoming policies, Guyana offers political stability important for long-term oil projects. The country has remained democratic since independence and maintains good international relations. Guyana is also making strides to develop supporting infrastructure through public-private partnerships. Key projects in the works include power generation, port facilities, and a natural gas pipeline. With strong institutions and infrastructure building, Guyana aims to leverage its oil wealth for sustainable development.
The recent discovery of massive oil reserves has put Guyana on the map for oil investors. Major firms like ExxonMobil are leading development efforts, with additional players showing interest. Guyana offers an attractive combination of abundant low-cost resources, favorable fiscal terms, political stability and infrastructure growth to support new projects.