One of the industry’s leading providers of analytical oil and gas data, Fitch Solutions, recently conducted an assessment of the political uncertainty that has gripped Guyana and the likely implications for the relatively young petroleum sector. At the conclusion of its evaluation, the consultancy group which is based in the United Kingdom found that ongoing projects are going to be impacted but not to a significant degree.
Fitch Solutions specifically stated, “In our view, the elevated electoral uncertainty in Guyana will not impact the ongoing development projects carried out by ExxonMobil to a great extent given low risk of potential changes to contracts between the government and the company.”
The UK firm was also keen to note that even if there are potential changes to contracts awarded for Guyana’s offshore concessions, they are likely to exclude the Production Sharing Agreement Guyana signed in 2016 with ExxonMobil and its partners, Hess Corporation and CNOOC/NEXEN.
Fitch Solutions was keen to remind that ExxonMobil, partnering with Hess and China National Offshore Oil Corporation, is continuing developing works in the Stabroek Block’s Liza field. It was keen to note that ExxonMobil which is the operator of the block has restored the average daily output of 80,000-90,000 barrels of oil per day (b/d) after a reduction of production to 27,500b/d caused by a technical glitch with the natural gas reinjection equipment for the Liza Destiny vessel.
Furthermore, Fitch said that the recovery in the output supports its short term crude oil production forecast for Guyana in which it expects the country to deliver the average of 55,000b/d in 2020. Fitch also said it will maintain its forecast given ExxonMobil’s commitment to pursue Liza-One and Liza-Two as initially planned, despite the substantial cuts to its capital expenditure plan for 2020.