Guyana’s Oil Wealth Comes With Some Strings Attached

Guyana’s Oil Wealth Comes With Some Strings Attached
An oil well pump operates in Boca de Jaruco, Cuba, July 11, 2014 (AP photo by Desmond Boylan).

If the global scramble to replace Russia’s oil in the wake of its Ukraine invasion had occurred a few years from now, instead of today, diplomats would be turning not only to Saudi Arabia, Iran and Venezuela for potential new sources of oil, but also to another, perhaps unexpected country: Guyana, a minuscule South American nation that is now in the process of becoming a petroleum powerhouse.

In the history of the world, few moments­ like this—in which an impoverished country suddenly discovers that it possesses untold wealth—have ever occurred. And yet, that’s what happened in Guyana in 2017, when ExxonMobil revealed that it had made a major oil discovery in the country’s coastal waters. Since then, similar finds have kept coming. Guyana is now believed to possess some 10 billion barrels of oil in its deposits, worth an eye-watering $130 billion over the next 20 years.

In a country that is one of the poorest in its hemisphere, where in 2011 nearly half the population lived on less than $6 a day, the news was understandably greeted with euphoria. If all goes well, gross domestic product could skyrocket 1,000 percent by 2025, according to former U.S. Ambassador Perry Holloway.

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