Guyana’s commitment to contract integrity earned US$6B in oil revenues

Guyana’s oil wealth, concentrated in the Stabroek Block, has transformed the nation’s economic fortunes, not only through direct revenues but also through substantial benefits for ordinary people. These benefits show the importance of the Government’s principle of contract sanctity and respect for investors.
While the Government recognises that the petroleum agreement for the Stabroek Block is less favourable to Guyana than it could be, the Government firmly upholds the principle of contract sanctity.
This has been underscored on numerous occasions by Vice President Bharrat Jagdeo who stated, “We pride ourselves in being predictable, fair, and working with the companies in partnership but looking out for national interests.”
He has said that this approach is not merely about honouring one agreement but about preserving the broader investment environment. Respecting contracts is widely known to foster investor confidence, signalling to foreign companies that Guyana is a stable and reliable partner for long-term investment.
The Vice President has said that the industry appreciates predictability and non-capricious behaviour.
A predictable and fair investment climate has thus far encouraged further exploration, development, and innovation, ensuring that the oil wealth continues to benefit the country across generations. Additionally, it aligns with the electoral mandate of the People’s Progressive Party (PPP), reflecting the will of the electorate who entrusted the Government with managing this vital sector.
To date, Guyana has earned approximately US$5.5 billion in direct government revenues from oil production, which is being invested into critical infrastructure, healthcare, education, and energy. These revenues have also empowered the government to advance climate adaptation and mitigation efforts, addressing the country’s vulnerability to flooding and other climate-related challenges.
Notably, however, the country’s oil wealth do not only come from direct revenues.
When the PPP Government assumed office, Guyana lacked local content legislation, leaving Guyanese businesses and workers with limited opportunities to capitalise on the oil boom. In 2021, the Government introduced the Local Content Act, mandating increased hiring of Guyanese nationals and awarding contracts to local businesses in specific sectors.
This legislation has empowered Guyanese companies to provide basic services as well as offer specialised capabilities. For example, local companies now fabricate steel for Floating Production, Storage and Offloading (FPSO) vessels, directly contributing to the infrastructure that facilitates offshore production. The Local Content legislation now generates hundreds of millions of US dollars annually for Guyanese businesses and fosters generational wealth.
Further, in 2024, the Government enhanced local content by increasing the bid evaluation weighing for local companies from five per cent to 10 per cent, giving businesses with local content certification a greater competitive edge. Over 800 Guyanese companies have already acquired local content certification, and can reap the benefits of increased access to contracts.
Aside from Local Content, there is the benefit derived from oil companies’ corporate social responsibility. One such example is the Greater Guyana Initiative (GGI), funded by ExxonMobil, Hess, and CNOOC. This US$100 million, 10-year initiative supports diverse projects that drive societal transformation.
Key examples include the construction of the Berbice Stadium; the Accelerate-HER Programme; the enhancing community wellness project; the Egg Sandwich Project; the University of Guyana Campus Safety and Security Project, and the Centre for Local Business Development.
These initiatives, and others under the GGI, demonstrate the oil sector’s contributions to diverse areas of national development, from health and education to entrepreneurship and infrastructure.
Overall, Guyana’s oil wealth offers benefits far beyond direct financial inflows, driving local capacity building, societal development, and economic diversification. By respecting contract sanctity and maintaining a favourable investment climate, the government ensures that these benefits continue to grow while safeguarding Guyana’s long-term economic health.