News Americas, GEORGETOWN, Guyana, Fri. Mar. 6, 2015: Guyana could possibly add oil to its list of natural resources if a top U.S. company strikes black gold on the South American territory’s land in the Essequibo, an area that lies near Venezuela.
Exxon Mobil is set to officially start drilling at the large Stabroek Block off the coast of Guyana today, Guyana’s Natural Resources Minister Robert Persaud said Thursday.
The drilling will occur in waters that lie in an area claimed by Venezuela in a territorial controversy dating back more than a century. Exxon through its Guyana affiliate, Esso Exploration and Production Guyana, Limited, (EEPGL) signed a Production Sharing Contract (PSC) in Georgetown, Guyana in 1999 with then President Janet Jagan to explore the 26,800 square kilometer block, 100 to 200 miles (160 to 320 km) offshore in 650-10,000 feet (200-3,000 meters) of water and covers approximately 15 million acres.
Guyana President Donald Ramotar has said Venezuela has written to Exxon’s office in Guyana protesting about the movement of its rig.
The Venezuelan government, however, this week claimed that it had not been notified of any exploration works and that it was a “unilateral” action from Guyana.
Guyana “has requested that the Government of the Bolivarian Republic of Venezuela desist from taking any actions that could only result in the stymieing of the development of Guyana and its people and that would be in contravention of international law,” the government in Georgetown said in a statement.
Ramotar reportedly met Exxon Mobil officials in Georgetown this week and the company’s exploration rig ship, Deepwater Champion, was put in position at the concession area.
Exxon for its part has said it was operating the block under license from Guyana.
“Border disputes are a matter for governments to resolve through bilateral discussions and appropriate international organizations,” a statement said.
ExxonMobil will invest around US$200mn in an offshore drilling program in Guyana. Exxon currently holds interest in more than 300 deepwater blocks around the world.
Oil companies have in recent years shown increased interest in Guyana, which is located next to Venezuela and Trinidad and Tobago, both major oil producing nations.
Meanwhile, the Venezuela and Guyana face-off comes as a New York district court on Wednesday rejected Venezuela’s bid to reduce interest on a $1.6 billion award that an international tribunal had ordered it to pay Exxon Mobil Corp in compensation for nationalizations.