In the first quarter of 2024, Guyana earned $126.3 billion (US$604.3 million) from oil revenues, as documented by the Natural Resource Fund (NRF) records. A significant portion of this income was derived from oil profits. Notably, this quarter marked the first time that revenues included payments from the Prosperity Floating Production Storage and Offloading (FPSO) vessel, Guyana’s third FPSO, which began production in November of the previous year.
The year’s initial profit oil payment, amounting to $15.3 billion (US$73.5 million), was recorded on January 2, 2024, for the lifting of 1 million barrels of oil in December 2023 from the Liza Unity FPSO. Additionally, a royalty payment of US$63.5 million, associated with the last quarter of 2023’s oil production, was recorded on January 29, 2024. A subsequent profit oil payment from the Liza Destiny FPSO on February 2 amounted to US$76.5 million.
The Prosperity FPSO contributed two profit oil payments: US$73.1 million on February 2 and US$78.3 million on March 8. The Liza Destiny FPSO made another payment of US$82.1 million on March 25. Meanwhile, the Liza Unity FPSO, which has been in operation since 2022 and now produces 250,000 barrels per day, was responsible for two lifts amounting to US$75.3 million on February 15 and US$81.6 million on March 6.
In December 2021, the NRF Act was amended for greater transparency and accountability in managing Guyana’s oil resources, including annual parliamentary approval for fund withdrawals as per Section 19 of the NRF Act 2021. The NRF funds, held at the Federal Reserve Bank of New York, originate from the oil-rich Stabroek Block offshore Guyana. This block is operated by ExxonMobil and its partners, Hess Corporation and CNOOC, using the Liza Destiny, Liza Unity, and Prosperity FPSO vessels.
Recently, the Guyana Government proposed a bill to increase the NRF withdrawal limits significantly. Presented by Senior Minister with responsibility for Finance, Dr. Ashni Singh, the Fiscal Enactments (Amendment) Bill 2024 aims to amend the NRF Act among other legislations, proposing a new withdrawal formula that allows for a higher percentage of withdrawals from the fund’s deposits.
This new formula contrasts markedly with the current NRF Bill from 2021, indicating a strategic shift in managing the country’s oil revenue. Vice President Bharrat Jagdeo emphasized that the government intends to invest oil revenues in developing the country’s productive capacity and its people. He countered criticisms of the NRF management, stating the importance of investing in addressing inequalities over early savings, thereby ensuring that the NRF serves as a structured, formula-based mechanism for expenditure.
