As a result of the oil industry being hard hit last year by the COVID-19 pandemic, oil prices sank to historic lows, leaving new and established oil producers forced to make significant cuts to their projections. But 2021 seems to be the year of recovery as Goldman Sachs, one of the world’s leading investment banks, is predicting that Brent Crude prices could move from the US$30 to US$40 spread to US$60.
If this is realized, it means Guyana could eventually get paid US$60M or more per ‘million-barrel-shipment’ on its offshore oil in summer 2021. According to Yahoo Finance, The Wall Street investment bank had previously predicted oil would hit US$65 by year-end too.
Guyana Standard understands that the rise in prices is being attributed to output cuts in Saudi Arabia and the implications of a shift in power to the Democrats in the United States.
On this matter, Yahoo Finance reported that analysts at the investment bank have informed that “the Democrat-led sweep of the U.S. Senate runoff elections and Saudi Arabia’s recent announcement of unilateral production cuts have left commodity markets with a ‘tighter’ medium-term outlook.”
To date, Guyana has discovered over 9 billion barrels of oil equivalent resources and already producing 120,000 barrels of oil per day. If ExxonMobil and its partners maintain that level of production from the Liza Phase 1 field offshore on the Stabroek Block; brings its 220,000 barrels per day in the Liza Phase 2 field on stream in 2022; and brings the 220,000 barrels per day Payara field on stream by 2024, then it would achieve its goal of 750,000 barrels of oil per day in 2025-2026, other things being equal.
Meanwhile, UK-based Westmount Energy Limited last week announced that ExxonMobil had commenced drilling operations at the Bulletwood-1 oil well, on the Canje Block, offshore Guyana. That venture is set to target approximately 500 million barrels of oil equivalent resources.