By the end of this year Guyana could have approximately US$500 million in its Natural Resource Fund (NRF), the Inter-American Development Bank (IDB) has stated in its first quarterly report for 2021.
“The government received US$267 million for oil sales and royalty payments through 2020 and March 2021… with Brent crude oil at more than US$60 a barrel and the expectation of oil production increasing by 46.7 % in 2021, government oil revenues could significantly increase this year. The government could receive US$263 million in oil revenues …which would take the balance of the NRF to approximately US$500 million by the end of 2021,” it states.
The report titled “Imagining a Post-COVID Tourism Recovery: Regional Overview” seeks to analyze economic challenges facing IDB member countries – The Bahamas, Barbados, Guyana, Jamaica, Suriname and Trinidad and Tobago.
It presents global travel sentiment analyses and post pandemic tourism demand trends and concludes that given travelers’ revealed preferences and the fact that most current tourism activity relies on the region’s attractive natural assets, environmental sustainability and climate change adaptation will be more critical than ever.
“These issues must…be prioritized in the public and private sector policy and investment agendas,” the study says.
Speaking specifically about Guyana the study notes that the eco-tourism packages offered by the country retain positive perspective as the global economy gradually recovers from the coronavirus.
Oil is however projected to be more impactful with Guyana’s economic growth related to the assumption that oil production will increase by 46.7%, from 74,300 barrels per day in 2020 to 109,000 in 2021.
“Over the medium term, oil production is expected to continue driving GDP growth, with oil exports growing by an annual average of 48.5 % over 2020– 2023, contributing to average annual GDP and government revenue growth rates of 17.1 and 6.7 %, respectively, in 2021 –2026,” the report projects, adding that Government expenditures are estimated to grow by an average of 5.3 % over the same period, contributing to a fall in the fiscal deficit from 7.4 % in 2020 to 3.4 % in 2026.
These numbers are based on the IMF-World Outlook published in April 2021 and were generated on the assumption of an average price of oil of US$58.52 per barrel in 2021 and US$54.83 per barrel in 2022, with the price remaining un-changed in real terms thereafter.
Recent discoveries have improved these medium term projection including the 19th oil discovery announced by ExxonMobil on April 27.
This discovery increased the estimate of recoverable petroleum resources from 8 billion to 9 billion oil -equivalent barrels and ExxonMobil updated its development plans of having five oil production projects by 2026 to six projects by 2027, which they see could potentially grow to 10 production projects in the future.
