Jan 27, 2022 News
Kaieteur News – Finance Minister, Dr. Ashni Singh disclosed during his $552.9B budget presentation for 2022 that Guyana is forecast to achieve a Real Gross Domestic Product (GDP) of 47.5 percent this year.
He said this is a rate of growth no other country in the world is currently projected to achieve in 2022. Dr. Singh said this reflects the coming into operation of the second FPSO vessel, the Liza Unity, which will significantly ramp up oil production. He was keen to note that the non-oil economy is expected to continue registering strong growth, currently projected at 7.7 percent this year, driven mainly by rebounds in rice growing and gold mining, and continued expansion in construction activity and wholesale and retail trade and repairs.
With respect to last year’s GDP performance, Dr. Singh said real Gross Domestic Product is estimated to have grown by 19.9 percent, while non-oil GDP is estimated to have grown by 4.6 percent in 2021, despite the persistence of COVID19 as well as the impact of the floods. With this rate of overall growth, Guyana is likely to be amongst the three fastest growing economies worldwide in 2021, the official said.
In terms of production, the Minister said a total of 42.7 million barrels of oil were produced in 2021 compared with 27.2 million in 2020. Dr. Singh said this level of output was supported by the remedying of the mechanical issues initially encountered as a result of which the oil production rate for 2021 is now estimated at approximately 116,900 barrels of oil per day (bpd). The Finance Minister said the increased level of production resulted in the subsector’s value added increasing by an estimated 46.5 percent.
As a new oil and gas producer and the country with the 17th largest oil reserves in the world to date, the Finance Minister said the oil and gas sector promises to be the driver of historically high levels of growth in the Guyanese economy with strong positive spillovers into the non-oil economy.
He said, “This is already observed in our economic performance over the past two years, and the external environment remains supportive with demand for oil anticipated to exceed pre-pandemic levels in 2022 and a very positive near-term outlook. Ongoing exploration activities have continued to yield positive results, with 28 commercially viable oil discoveries to date in the Stabroek Block and an estimated recoverable resource of over 10 billion oil-equivalent barrels, a mere 6 years after first discovery.”
The Minister added, “The Stabroek Block currently has three identified production areas Liza 1, Liza 2, and Payara. Production capacity is currently at 120,000 bpd with the Liza Destiny FPSO in operation. The coming into operation of the Liza Unity FPSO early in 2022 will raise capacity to 340,000 bpd, and the deployment of the Liza Prosperity FPSO in 2024 will further raise capacity to 560,000 bpd.”
With the anticipated fourth production area, Yellowtail, Dr. Singh said estimates are poised to reach 810,000 bpd by 2026/27 while noting that additional developments under consideration could see Guyana reaching six FPSOs producing 1 million barrels of oil per day by 2030.
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