Oil revenue sharing deal must be fairer

Dear Editor,

Guyana is expected to earn US$6.5 Billion from the country’s share of profit oil and royalties in 2026 (Bank of Guyana (BoG) report section 3.64 on page 21, (https://finance.gov.gy/wp-content/uploads/2026/09/Mid-Year-Report-2026.pdf^[1] ).

While US$6.5 Billion is a significant amount, and it is much larger than what Guyana has collected in any year in the past, the question is: Will Guyana earn 14.5% for first-half 2026; and thereafter, earn 41.8% for the second-half 2026? In reply to this question, and without introducing some other production and revenue considerations, the answer to this question is that Guyana will not receive 41.8 % of total revenue in the second half of 2026, but only 25.5% of total revenue; and this 25.5% of total revenue in 2026 is before Guyana pays the taxes for the consortium (ExxonMobil Guyana Limited, Hess/Chevron and CNOOC) from its share of total revenue. Consequently, after paying the consortium taxes, Guyana’s share of total revenue in real terms will only be US$1.13Billion or 4.4 percent of total revenue, which is derived below.

It is reported that an amount of US$508.1 Million will be collected as royalty, which is equal to 2 percent of Total Revenue (BoG Report, section 3.64, page 22). As result, the total revenue (TR) for 2026 is estimated at US$25.41 Billion (= US$508.1 Million ÷ 2%). In the referenced article above, Guyana’s profit share is estimated at US$5.97 Billion or 23.5% of total revenue before taxes in 2026; and since the consortium will receive the same profit amount as Guyana, the total profit for the year will be US$11.94 Billion, while total cost will be US$13.47 Billion or 53 percent of total revenue (Table1).

On the issue of taxes which Guyana pays for the consortium from its share of revenue, no information on this amount is available at this time. However, during the period 2020 to 2024 when Guyana received a total US$6.3 Billion in oil revenue, the tax amount that Guyana paid from its share of total revenue on behalf of the consortium was US$5.2 Billion, or 82.54 percent (https://www.oggn.org/2026/05/09/end-the-tax-and-oil-profit-giveaway/^[2]). Applying this same tax rate to the earning that Guyana is expected to receive will result in a tax amount of US$5.3Billion for which Guyana will have to issue tax receipts to the Consortium. Therefore, the net amount that Guyana receives in real terms is only US$ 1.13 Billion or 4.4 percent of total revenue (Table2).

In conclusion, it is likely that Guyana will receive in real terms only 4.4% of total revenue in 2026; and with new projects being added to the cost bank, together with no ring fencing being applied, it is contended that 41.8 % of total revenue for Guyana in the second half of 2026 will not be achieved. Therefore, a more equitable approach and an agreement on the distribution of total revenue must be found. Wake up Guyana!

References

1. https://finance.gov.gy/wp-content/uploads/2026/09/Mid-Year-Report-2026.pdf ↩
2. https://www.oggn.org/2026/05/09/end-the-tax-and-oil-profit-giveaway/ ↩