One of South America's Poorest Countries Has Struck Oil
Find excites but worries Guyana
By Newser Editors and Wire Services
Posted Sep 5, 2016 2:58 AM CDT
Updated Sep 5, 2016 6:18 AM CDT
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People walk near the central bank in Georgetown, Guyana.   (AP Photo/Bert Wilkinson)

(Newser) – Guyana has long been one of the hemisphere's poorest places, a sparsely populated nation on South America's northern shoulder that relies heavily on exports of sugar, rice, and gold. But these days, there's a surge of excitement about an anticipated windfall from major oil-and-gas deposits found in the deep seabed 120 miles off the coast—as well as worries about the disruptions and conflicts it might bring, the AP reports. The US Geological Survey had long estimated that offshore Guyana was rich in gas and oil. Now, US-based ExxonMobil has announced a "world-class oil discovery" off Guyana after drilling a well that struck oil-bearing sandstone with an estimated 800 million to 1.4 billion oil equivalent barrels.

Exxon and partner Hess Corp. haven't yet announced development or investment plans, which could be complicated by low current oil prices and a dispute with neighboring Venezuela. But Guyanese authorities, with the assistance of Norway and the US Energy Department, are racing to set up rules and plans to administer the hoped-for new industry while avoiding what is known as the "resource curse." Guyana's presidential spokesman, Mark Archer, says the administration is determined to avoid the mistakes of Venezuela and other energy-rich nations that have run into hard times. "The plan is not to spend wildly like a drunken sailor but to put in a wealth fund for future generations and ensure we do not neglect agriculture," he says.