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This post will be a summarization of the, somewhat interesting, activity with Exxon in Guyana right now and what it means for Exxon. Not financial advice. I don't currently hold any positions (poor).
If you don't know, Guyana is a small, somewhat shit, South American country to the East of Venezuela.
[](https://preview.redd.it/long-on-exxon-a-short-look-at-guyana-trump-maduro-and-the-v0-ixfrgicr23ug1.png?width=1080&format=png&auto=webp&s=282d468a2abd3f589a7db7af0d0e656c1821751a)
https://preview.redd.it/vrw6c25i33ug1.png?width=1080&format=png&auto=webp&s=f75e78e0a4122cd8942773ea1716811f9f44d5a4
They didn't do much until May 2015, when ExxonMobil and its affiliates in Guyana, looking more than 3 miles below the seabed, [found around 300 feet of oil-bearing sandstone offshore.](https://corporate.exxonmobil.com/locations/guyana/operations/guyana-project-overview#DiscoveriesintheStabroekBlock) In 2016, a second well, the Liza well, was also discovered. Since then, 45 total discoveries have been found, with billions more barrels-worth of oil lying beneath the surrounding waters. These are the largest oil discoveries in generations, and the area has since been dubbed the Stabroek block.
[](https://preview.redd.it/long-on-exxon-a-short-look-at-guyana-trump-maduro-and-the-v0-tbb3oies23ug1.png?width=1080&format=png&auto=webp&s=ccdbfbb49be82770dea85371b224f3f34754fd29)
https://preview.redd.it/aa3pr3xi33ug1.png?width=1080&format=png&auto=webp&s=890a12b26632ef8500d7dcd61825574b28cb73a7
Lacking the infrastructure and ability to profit off the oil itself, Guyana called on three companies, [Exxon (45% stake), Chevron (30% stake), and a Chinese subsidiary "CNOOC Petroleum Guyana,"](https://www.gem.wiki/Stabroek_Oil_and_Gas_Block_(Guyana)) to develop the area (Note: Chevron uses a subsidiary called Hess Corporation, but it's just Chevron).
We aren't completely certain on the terms of the agreement made between Guyana and the companies, but we know it was one of the biggest ball-drops imaginable, so heavily in favor or Exxon, Chevron, and CNOOC, that [Guyana only gets a measly 14% of the profits](https://ieefa.org/resources/ieefa-report-findings-2016-petroleum-agreement-between-guyana-exxonmobil-et-al), (Angola, for example, gets around 50-60%) while also making the country a tax haven all three companies, with little to no environmental protection oversight. Anyway, the point is, these companies have extremely favorable terms.
The biggest threat to the operation was Venezuela. The Stabroek block falls under disputed Venezuelan waters, and in December 2023, Maduro held a phony referendum, decided that those waters belonged to Venezuela, and [mobilized thousands of troops at the Venezuela-Guyana border](https://www.chathamhouse.org/2023/12/maduro-hoped-mobilize-venezuelans-around-old-grievance-guyana-he-seems-have-failed). The U.S, backing Guyana, told Venezuela to fuck off, though, so they did. However, interfering with oil is something the U.S cannot abide, and America has since thrown its weight behind Guyana (or, more appropriately, its stakeholders' interests in Guyana). With Maduro being a thorn in the side for a while, in a surprisingly strategic move, the US decided to get rid of him. Venezuela is thoroughly cowed, at least for a while, licking its wounds after the Maduro operation.
Today, Guyana is the 16th largest oil exporter, but it hasn't nearly reached its potential. While other countries have little room to grow their oil industry (or are nearly running dry), Guyana only \*just\* finally completed its oil pipeline. With the Guyana deal and Venezuela facing an internal crisis, Exxon has navigated every geopolitical hassle, and once it finishes its power plant to support the operation, it will control the fourth largest source of non OPEC oil in the world.
Needless to say, this is quite favorable for Exxon, and its stock reflects it, sitting at a solid $156:
[](https://preview.redd.it/long-on-exxon-a-short-look-at-guyana-trump-maduro-and-the-v0-d3kjuwgt23ug1.png?width=1024&format=png&auto=webp&s=f60737f70db4918bb349a1d773985010679ba54b)
https://preview.redd.it/rnyzh30k33ug1.png?width=1024&format=png&auto=webp&s=62ad555ac213931e2822332a457d4faa18a73d14
The latest volatility is due to the constant pissing match between the US and Iran spooking investors, who want the conflict to keep pushing oil prices up. But don't get it twisted: Exxon has a sweet deal, raking in billions of $$$ from a secure supply of Latin American oil, while conflict in the Strait of Hormuz continues. As US-Iran relations remain volatile, Exxon's stranglehold on Western Hemisphere oil takes on greater strategic importance, and profits rise.
Anyway, the point is, with tensions in the Middle East as they are, Exxon is a golden goose. Even if US-Iran relations suddenly settled completely (which they won't), Exxon's operations in Guyana are of such strategic energy importance that it can't go tits up; the US can't allow it to. I don't have much else to say, but:
TLDR: Exxon found biiig oil in Guyana, kept it hush hush, fucked Maduro like a pig, very important good yes especially while war in Middle East, make stock go up