Guyanas new president could mean trouble to Exxon Mobil

The new government of the world's youngest oil producer, Guyana, is trying to increase the need for local content in the employment and procurement of goods and services in the offshore oil projects, creating that need for ExxonMobil, the largest overseas developer of Guyana's vast oil reserves , could increase. After months of campaigning, Guyana's new President Mohamed Irfaan Ali and Vice President Bharrat Jagdeo, sworn in earlier this month, are demanding more from ExxonMobil on what's called local content. "We stand by our commitment to ensure that industry provides opportunities, as much as possible, not just to the local private sector, but to Guyana as a whole, here and in the diaspora, wherever the skills are," said the Guyana President. Ali, last week before the local media. According to energy analyst David Blackmon, the new requirement for local content, whatever it is, should strike a balance between the demands of the Guyana government and the need to keep the job running smoothly, as well as tenders and recruitment for the offshore operators and contractors. If Guyana fails to balance local content requirements with the reality of its local capabilities and sourcing of goods and services, it could potentially delay development projects led by overseas oil operators and contractors. ExxonMobil revised its estimate of recoverable resources off the coast of Guyana by 2 billion barrels of oil, or 8 billion barrels of oil equivalent, when it announced its 16th discovery in the Stabroek Block earlier this year. The recoverable resource base of 8 billion barrels of oil equivalent includes the fifteen previous discoveries that ExxonMobil and its partners had made off the coast of Guyana by the end of 2019. The new discovery, the Uaru well, is just 10 miles northeast of the Liza oil field, which is already producing oil. Guyana officially joined the ranks of oil-producing nations in late December 2019 after Exxon and its partners began producing oil off the coast of the South American country.