Crystal ball…on oil

Remember all the talk and pontifications on “peak oil”?? That point in time when the world will reach its maximum production – based on demand, which will then both fall as the switch to renewables really kicks in. From then onwards, the lower demand would also lead to lower prices, leading to oil production making no sense when even the lowest production cost would exceed acceptable selling prices!! Thus, the largest industry on planet Earth for over a hundred years would come crashing down!! You can begin to understand why this scenario scares the living daylight out of a whole lotta big ones – the biggest!!
The body that monitors world oil production and offers projections is the International Energy Agency (IEA) – formed back in 1974 following the crisis precipitated by the launch of OPEC!! For the longest while, it has been predicting that “peak oil” would be reached this decade – 2030 to be exact!! And it was for this reason some were questioning whether it was wise for us to be putting all our development eggs in one (oil) basket!!
Well, good news for us!! The IEA looked at the actual production of O&G – along with investment decisions being made across the world in exploration – versus the promises that weren’t being kept on switching to renewables and announced yesterday that global demand could grow until 2050!! So, all of us in Guyana can now not only let out a sigh of relief but should be bursting out some heartfelt hosannahs – seeing as how our oil-fuelled money spigot will continue to flow with increased gusto!! Happy days are here to stay!!
But this shouldn’t have come as a surprise to any of us – after we heard the news out of COP 30 going on in Brazil. The fact that the world ain’t gonna be meeting the 1.5 per cent cap on global temperature rise clearly means that enough cutbacks ain’t being made in oil and gas production and usage – but are actually rising!! The production charge is being led by the US – the world’s largest producer! With President Trump at the helm – not believing global warming is caused by fossil fuel usage – we can confidently predict that peak oil mightn’t even be in sight come 2050!!
In the meantime, we’ve got the best of both worlds!! As we head towards one million barrels per day of oil and beyond – not even counting in the natural gas!! – we can virtue signal to the rest of the world about our 85 per cent forest coverage that “sequesters” carbon and our energy production from renewables like water (Amaila Falls) and solar power!!
Hey!! We may even become a model for the rest of the world!!

…becomes real
A proof of the accuracy of our energy strategy is the news that a consortium of the French oil giant TotalEnergies (40 per cent), along with QatarEnergy (30 per cent) and Malaysia’s Petronas (30 per cent), has just signed a PSA with our Government for a shallow water field between 30 and 100 metres – off our coast!! That these very experienced companies would shell out a $15M bonus for a 1788-square-kilometre block – and announce a $20 million seismic exploration programme for next year – means they KNOW oil ain’t going out of style for quite a while!!
His signing is the first coming out of our very first auction back in December 2022. There had been six bidders submitting 14 offers for eight of the 14 oil blocks. In addition to the bonus, the royalty rate will be 10 per cent – five times the two per cent the PNC signed with Exxon!! The cost recovery ceiling’s also been slashed from 75 per cent to 65 per cent, with a 10 per cent corporate tax!! Profits will be split 50-50 per cent!
Whoopee!!

…on extradition
There’s an old bit of folk wisdom answering the question, “Where does an elephant sit?” – anywhere it damn well pleases!! Those who question why we’re going along with the US’ request for Sanction Man’s extradition should take note!!