Guyana has received approximately US$13.9 million in royalties for the first quarter of this year from the ExxonMobil Liza-1 operations and expects to add over US$60 million to its account from the sale of its recent sixth oil share and lift, sources have revealed.
This suggests that the country would have earned similar amounts to what it received for its fifth share, as global oil prices continue to remain steady, averaging for this month so far, about US$63 per barrel Brent crude. The lowest price in April was pegged at US$61 per barrel while the highest was yesterday’s figure which stood at US$66.
The sixth lift was sold to Hess at the April 14 spot price, which at the time was around US$66 per barrel Brent crude.
Sources told Stabroek News that the royalties have been deposited into the account designated as this country’s Natural Resource Fund.
Added to the US$267,668, 709.12 that currently sits in the account, Guyana would have so far earned around US$342.5 million since production began here in December 2019.
The Wall Street Journal reports that analysts are predicting an even bigger increase in the price for oil with Brent prices expected to reach US$70 per barrel in the second quarter from the US$60 it predicted previously and US$75 in the third quarter up from US$65.
It stated also that Morgan Stanley expects Brent crude prices to climb to US$70 per barrel in the third quarter on “signs of a much improved market” including prospects of a pick-up in demand.
The government has declared that it remains committed to providing updates on oil lifts and sales as may be necessary, to ensure all stakeholders and members of the public are informed.
The Natural Resource Fund legislation has not yet been enacted and activated, and observers have pointed to the seeming sloth with which the Irfaan Ali PPP/C administration is moving to see the critical piece of legislation be enacted, despite being in office for more than nine months.
Minister of Natural Resources Vickram Bharrat has said that Hess again was the marketer and that the selection of a marketer sought by this country through a procurement process earlier this year “will be out soon” as it “was under review”.
In late September last year, 29 companies responded to government’s retender of the Request for Proposals (RFPs) to market Guyana’s share of oil from the Liza Destiny FPSO and this was reported in the October 1 2020 edition of the Stabroek News. The submissions followed an announcement by the PPP/C government, after taking office in August last year that it had scrapped the shortlist of 19 companies from the 34 that had participated in the first process under the APNU+AFC government back in April of 2020.
The tenders submitted in April last year came while the country was in the middle of a political crisis and awaiting the results of the March 2 General Elections. Vice President Bharrat Jagdeo had announced in February that 28 of the 29 were deemed non-responsive from the process because of the “nonsensical” inclusion of evaluation of tender documents.
He had said that government was mulling the removal of the criteria and inviting all companies which submitted proposals to resubmit their documents.
