On June 1st, 2018 the Stabroek News published an article discussing a report by Norway’s Rystad Energy. Other Caribbean newspapers have published similar articles. However, there appears to be inconsistencies in the report that need clarification. Here are a few points of concern:
- It was stated that Rystad is forecasting 600,000 barrels per day (bpd) in the next decade. The IMF report forecasted 100,000 bpd for Liza Phase 1 well. (This well is estimated to hold 450 million barrels of oil). Currently, 3.2 billion barrels of oil have been confirmed to exist by the oil companies. Now, that is more than 7 times the Liza Phase 1 discovery, hence, one would expect a forecast of at least 700,000 bpd, not 600,000 bpd?
- In the article, it stated for the Liza field, that US$10 billion will be split between Guyana and the oil companies. This means that Guyana would receive US$5 billion. Exxon’s management has been quoted in the news saying Guyana will earn US$7 billion from Liza Phase 1 when oil is priced at US$50. Why is the Rystad figure lower especially given the price of oil lately has fluctuated in the US$70 to US$80 range?
- The article also stated that according to Rystad, Guyana will earn US$15 billion annually from oil and gas in the next decade. Now, that would mean Guyana would earn at least US$150 billion. But if Exxon’s management is saying that Guyana would earn US$7 billion on the 450 million Liza Phase 1, then if we scale that number up to the 3.2 billion reserves, that should mean that Guyana would earn approximately US$50 billion not 3 times that amount.
It would be appreciated if Stabroek News or Rystad Energy clarify the inconsistencies in these figures or publish a copy of the Rystad report.
Darsh Khusial, Mike Persaud, and Charles Sugrim
on behalf of Oil and Governance Network