The United States is tightening its grip on a powerful new energy frontier, as ExxonMobil’s deepwater oil operations off the coast of Guyana reshape the geopolitical map of South America. With billions of barrels in proven reserves, the country has become a key node in Washington’s fossil fuel strategy — and Exxon is leading the charge.
Exxon’s Billion-Barrel Breakthrough
In 2015, ExxonMobil struck a major discovery — nearly 11 billion barrels of oil buried beneath Guyana’s offshore seabed. In less than a decade, this once-overlooked rainforest nation has transformed into the world’s fastest-growing oil producer.
Today, Exxon and its partners, Hess and CNOOC, extract around 650,000 barrels per day, with output set to double by 2027. By 2035, Guyana is forecast to lead global oil production growth, an outcome that secures a stronger American energy presence just miles from Venezuela and Brazil.
Guyana’s embrace of Exxon aligns with long-standing US interests in maintaining strategic access to global energy resources — particularly in politically fragile or contested regions.
Washington’s Quiet Win in South America
Guyana is geographically and politically pivotal. Sandwiched between Venezuela, Brazil, and Suriname, it offers a stable base of operations in a turbulent neighborhood. While Venezuela’s oil sector remains under US sanctions and riddled with dysfunction, Exxon’s stake in Guyana ensures American corporate control of a major new reserve.
President Mohamed Irfaan Ali, who inherited the oil deal from his predecessor, continues to promote the industry as a path to modernization. In doing so, he has enabled Exxon’s continued dominance while reassuring Western investors and governments that Guyana remains open for business.
Despite the country’s role as a carbon sink, with 90% of its land covered in forest, the Ali administration argues that fossil fuel extraction can coexist with climate goals — an argument that finds favor in energy circles focused on stable production over environmental optics.
Imbalanced Profits and a Tilted Contract
The 2016 production sharing agreement between Guyana and Exxon has drawn fierce criticism for heavily favoring the company. Exxon can recover up to 75% of its investment from revenues before profits are split — 50% to the government, 50% to the Exxon-led consortium. Guyana also receives a 2% royalty.
President Ali acknowledged the deal was flawed but has refused to alter its terms, signaling continuity and predictability for foreign investors. Exxon defends the contract as “globally competitive” for countries in early exploration stages, noting that Guyana is earning $1 billion annually and has accumulated $6.2 billion in its sovereign wealth fund.
Critics, including international lawyer Melinda Janki, argue the deal gives Exxon vast control over a public resource while exposing Guyana to serious environmental risks. She has led a legal campaign that resulted in a court ruling imposing unlimited spill liability on Exxon — a decision now under appeal.
Internal Unrest, External Pressure
The economic boom hasn’t lifted all boats. Inflation reached 6.6% in 2023, and locals report sharp increases in food and housing costs. “The money is not trickling down to the masses,” said Wintress White of Red Thread, a grassroots advocacy group. Despite eye-popping GDP growth — over 33% in 2023, and 40% in 2024 — inequality is growing.
Meanwhile, Exxon says it has invested $2 billion with local businesses, created 6,200 jobs, and funded $43 million in community projects. Still, many Guyanese question who truly benefits — the people or the multinational.
The Essequibo region, the site of key oil assets, is now subject to territorial claims by Venezuela, adding geopolitical friction to the energy equation. The US has signaled support for Guyana’s sovereignty, a stance that further integrates the country into American strategic interests in the hemisphere.
