Traces of petroleum have been recorded in Guyana since the 1750s, back when Dutch explorers were mapping the country. Wells drilled in 1916 produced some natural gas that powered local utilities for several decades, while Shell and the California Oil Company made exploratory drills in the 1950s and 1960s. However, while discoveries in Venezuela and Brazil propelled their economies forward, the former British colony of Guyana has been quiet. Until now.
A string of major offshore discoveries by ExxonMobil in just the past year has made Guyana the new hotbed of upstream exploration. The Guyana-Suriname Basin is considered one of the last unexplored areas in the world with significant petroleum potential, with the US Geological Survey estimating that some 13.6 billion barrels of oil and 32 tcf of natural gas could lie underneath the waters. Guyana is finally fulfilling its potential, with ExxonMobil announcing a sixth major discovery earlier this month.
All located within the Stabroek block, which ExxonMobil operates with partners Hess and CNOOC Nexen, the recoverable volumes from Stabroek have risen from an initial 1.4 billion barrels when the first successful Liza-1 well was discovered to 3.2 billion barrels with the success at the Ranger-1 well. FID has already been sanctioned on Stabroek, with the US$4.4 billion project expected to begin producing 120,000 b/d of oil by 2020, from zero right now.
The success at Stabroek has caused a rush of interest in Guyana, despite the fact the Venezuela claims some of the discoveries encroach on its territory. Tullow Oil and Eco are ramping up exploration in their Orinduik project, encouraged by the adjacent Ranger discovery. Chevron has expressed interest in acquiring acreage in Guyana, while Repsol and Tullow Oil are surveying the Kanuku block. The rush of discoveries is even prompting some firms to look into neighbouring Suriname, where Tullow Oil and Kosmos Energy are already present.
The last time an overnight change happened in a country with a major oil/gas discovery was Israel, when the Tamar and Leviathan gas fields were discovered in 2008/2009. With less than 800,000 people and a GDP per capita of US$4,419, the oil revolution will have a far larger impact on developing Guyana. As oil companies rush to make the next big Guyanese discovery, it is evident that Guyana is the latest oil economic success story.