Venezuela announced it would hold a referendum on December 3 to decide whether to annex the Essequibo region, a territory currently part of Guyana.
The President of the National Assembly of Venezuela, Jorge Rodríguez, announced that he would consult the Venezuelan population to determine whether or not they agree with the claim to the territory disputed with the neighboring country. The area is part of the equatorial margin, a place where oil “bubbles.”
The decision to hold the referendum came after a meeting between Rodríguez and Elvis Amoroso, president of Venezuela’s National Electoral Council (CNE). The Venezuelans see the possible annexation as a “peaceful reunification” of the territories.
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The Essequibo region covers more than 160,000 square kilometers and accounts for 70% of Guyana’s total area. Venezuela claims the area was part of its territory during colonial times. In 1899, the British Empire assumed sovereignty over Essequibo and after independence the region became part of Guyana.
The United Nations (UN) recognized the territory as part of Guyana in a 1962 decision. However, Venezuela continues to dispute this decision. It is worth noting that the Essequibo region is rich in oil and is of great importance to Guyana’s economy.
Venezuela’s motivations
It is worth noting that the equatorial margin, even referred to as the new Brazilian presalt, has proven to be a promising source of oil discoveries for Guyana. Guyana was a pioneer in the discovery of oil in the region in 2015 through the North American company ExxonMobil.
Since this initial discovery, there have been several reports of new oil reserves, and Guyana currently has reserves totaling 11 billion barrels. This volume represents around 75% of Brazil’s total oil reserves, which amount to 14.8 billion barrels, including discoveries in the presalt.
The Essequibo region sought by Venezuela lies on the edge of the equator and is the center of the dispute that will be discussed in December this year. In this sense, the equatorial margin is an extensive maritime region that extends from Guyana to the state of Rio Grande do Norte in Brazil.
Guyana, in turn, began producing oil in 2019 and now produces 375,000 barrels of oil equivalent per day. ExxonMobil, one of the main companies operating in the region, plans to increase this production to 1.2 million barrels per day by 2027.
Although there is great potential on the Brazilian side, exploration has been difficult due to environmental permitting issues. The Brazilian equatorial margin region includes several sedimentary basins, and of the 42 blocks already approved by the ANP, 11 are expected to see major investments in the next five years.
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