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Govt. assures Exxon not hiding true oil data
…says new discoveries do not equate to more oil for Guyana
Kaieteur News-While Guyana has seen an increase in oil discoveries over the past years, this does not mean the country now has more oil, Minister of Natural Resources, Vickram Bharrat told the Committee of Supply of the National Assembly last week.
He was at the time responding to questions on the allocations to his ministry in this year’s budget. Shadow Natural Resources Minister, Shurwayne Holder questioned Bharrat on whether there is an allocation in this year’s budget to monitor and understand the reserves as new discoveries occur. He also asked for an explanation on why government has been failing to update the reserves.
Minister of Natural Resources, Vickram Bharrat and senior staff of the Ministry during the consideration of estimates in the National Assembly
To this end, Minister Bharrat told the House, “When you look at it logically, there is no reason for Exxon or the government of Guyana to withhold any information as to our discovered resources. As a matter of fact, it would be counterproductive not to say we have 15 or 20 or 30 billion (barrels of oil).”
ExxonMobil is the operator of Guyana’s largest oil block- Stabroek- where the company first discovered oil in 2015. Since then, there has been a string of successful finds, taking the total discoveries to date up to 46. In April 2022, Exxon said the reserves in the Stabroek Block totaled 11 billion barrels. Two years and eight discoveries later, government said this grew to 11.6B. Notably, although Exxon supplies government with data, the company said its estimate of the resources was lower than 11B barrels.
While there continues to be questions about the real resources in the Stabroek Block, Bharrat told the National Assembly that updating the reserves to a higher number would make the country a more attractive place for investment. As such, he urged that there is no reason to believe the government is withholding any information.
The Minister explained that had there been an increase to the oil reserves, this would have helped the recent bid round to be more successful, as more companies would have been vying for a piece of the Guyana Basin.
Similarly, Bharrat said the non-release of this information by Exxon would not be helpful for the company. According to him, “If Exxon can say that we have 15B barrels of oil in the Guyana Basin, their share price would go up tomorrow morning…so it’s not that we don’t want to say, but that is the figure. We cannot manufacture figures and say oh we have 15B, oh we have 30B.”
He stressed that government has to ensure the truth is presented to the public and the fact remains that the country’s oil reserves is just 11 billion barrels of oil.
The Minister noted that while there have been additional discoveries by the oil giant over the years, the discovery pace has slowed down. He went on to explain the technical process associated with determining oil reserves.
He said, “Yes you may have a discovery and you may say oh we encounter 150 feet of oil-bearing sand and you might decide that you’re going to use that to shore up your resources and say this is equivalent to 2B or 3B- it don’t work like that.”
Conversely, the Minister said that during the appraisal programme that follows an oil discovery, the estimated reserves may come down. “Based on the appraisal programme, it could say look, instead of 165 feet of oil-bearing sand, we now have 250 feet and we can estimate at 500 million barrels of oil; or the appraisal programme could go the other way and say you know what, we over estimated at first and the reality is, it is not 165, it is just 65, and it is not 500 million barrels, it is just 200 million barrels.”
To this end, Bharrat said new discoveries do not equate to more oil for Guyana. “It is not a straightforward thing to say that oh we had 50 discoveries and then we add six more so we supposed to increase. It don’t work like that. It is based on the appraisal programme by the company,” the Minister stated.
(Govt. assures Exxon not hiding true oil data)
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