The Government is reviewing the terms and financing arrangements that could apply to Guyana’s next phase of oil projects, President Dr Irfaan Ali said on Tuesday.
The review comes as Guyana’s share of production from the Stabroek Block has increased to 39.8 per cent, following the recovery of development costs by ExxonMobil.
Ali said the Government is considering whether Guyana should invest directly in upcoming oil projects and whether the terms governing those developments should change.
“There are ongoing internal discussions… and of course, we will also seek the expert advice on this matter to make a determination on how the next phase of projects will be treated,” Ali said.
The President explained that Guyana’s share of oil production has risen from 12.5 per cent to 39.8 per cent as development costs were recovered earlier than expected under the existing agreement.
Ali illustrated the change by comparing the proportion of production previously used for cost recovery with the current position.
“In terms of barrels, 75 of every 100 barrels produced [were] the cost recovery; today, only about 20 barrels go to cost, while the US$55 billion expenditure was paid off,” he said.
According to Ali, the Government is now assessing how future projects should be structured, including the level of investment required and the potential return to Guyana.
He said global investment conditions, future exploration and the source of financing will also factor into the decision.
