Introduction
As indicated last week, today’s column aims to update my earlier (October 2016) assessment of Guyana’s petroleum discovery. But before addressing that topic I offer two very brief observations on last week’s forecast of the nominal price range for crude oil in 2025, the time I anticipate when I expect Guyana’s first oil will be fully on-stream. Last week’s forecast of the most likely prevailing price range (US$60 to US$74 per barrel) in 2025 is conservative. It is about one-fifth lower, at the mid-range, than the World Bank’s October 2016 forecast of US$82.60 for 2025. Second, at my maximum likely price range, I had further forecast the industry will be facing medium level risks to its commercial viability and sustainability.
Potentially massive
Turning to the petroleum find, as earlier indicated, published reports suggest petroleum exploration had gained much significance in Guyana during the 1940s, and perhaps earlier. It was much later though, in the 2000s that this exploration became firmly noticed by the oil majors, along with the minors, independents, and local/overseas joint ventures. In 2000, the US Geological Survey’s World Petroleum Assessment, Central and South America, had identified the Guyana-Suriname Basin as a significant petroleum reservoir, holding perhaps 15.2 billion barrels of crude oil; 42.1 billion cubic meters of natural gas and 2.3 billion barrels of natural gas liquids. This certainly makes this reservoir one of the world’s largest potential petroleum deposits.