Black Gold: The Guyana Opportunity

Welcome to this week’s edition of ‘The Adventure Capitalist’. Many exciting changes are going on over here, expect to hear from me more often in the upcoming weeks!

Here’s what you can expect in this issue:

• The most fascinating investment opportunity you've never heard of.

• Wild tigers and silk sheets? I discovered what might be the greatest hotel in the world – and it’s in a place you wouldn’t expect.

• An assortment of links to get your blood flowing.

Let’s dive into it.

Black Gold: The Guyana Opportunity

A couple of months back, I couldn’t point out Guyana on a map. Next month, I’m taking an 8-hour flight there because I believe it might become the world’s next Dubai. 

This is the story of the oil boom that’s changing the world. 

Could Guyana become the next Dubai?

In May 2015, ExxonMobil discovered offshore oil in Guyana now believed to be a total of at least 11 billion barrels. This discovery ranks among the largest ever. 

To put it in perspective, Guyana now has more oil reserves per capita than anywhere else in the world – almost three times as much as Saudi Arabia. 

Seemingly overnight, Guyana transformed from a little-known South American nation to potentially Exxon's top oil producer and an emerging petrostate.

This discovery not only reshapes Latin American dynamics but also forecasts a future where Guyana could emerge as the "Dubai of Latin America."

While the rest of the world's economies shut down during COVID, Guyana’s was ripping. In 2023, Guyana was the world’s second-fastest-growing economy in the world – growing by a whopping 38.40%.

Foreign investments have been pouring into Guyana. While Guyana has a long way to go before it becomes a global player, it’s firmly on the map as a country on the rise. 

Locating the World’s Newest Petrostate:

If you're wondering where Guyana is, you're not alone. Often mistaken for an African country, Guyana nestles between Venezuela, Brazil, and Suriname.

The Opportunities in Guyana:  

I’m largely interested in the “picks and shovels” opportunities in Guyana. There will be fortunes made from supporting the oil industry and helping the government modernize its economy. 

Guyana is well aware of the “resource curse” that’s plagued many natural resource-rich nations, and the government is using its new oil wealth to inject money into national development.

Just this month, Guyana approved its first trillion-dollar budget. In that budget, billions of dollars will be spent on construction, infrastructure, healthcare, education, and more.

Take a look at some of these staggering numbers.

• $204.1 billion for transport infrastructure.

• $135.2 billion towards education.

• $129.8 billion has been budgeted for the health sector.

• $90.6 billion towards public safety and security. 

• $78 billion for housing, water, and sanitation. 

• $97.6 billion for agriculture and food security. 

That is a lot of money being spent on development in any country, let alone a tiny country like Guyana.

My biggest question is who is going to fulfill these contracts and do the work? 

The Guyanese people cannot do it alone. Guyana's population is just 800,000 and is a largely unskilled workforce. If they are going to successfully modernize their economy, they are going to have to rely on foreign companies and workers to help them do it. 

The gears of capitalism are already turning to support growth in Guyana. By the end of the year, four new hotels will open in the capital Georgetown, and they’ll add new flights from Houston and Miami to keep up with the demand. 

The Risks of Doing Business in Guyana:

Doing business in Guyana does not come without risks. If you do a quick search you will see many articles about the possibility of Venezuela invading Guyana. 

In December, the people of Venezuela voted to invade and annex a part of Guyana called the Essequibo Region.

The borders near Venezuela and Guyana have changed many times during the last 200 years and Venezuela claims they have territorial rights to 61,600 square miles of dense rainforest to the west of the Essequibo River.

The territory dispute is all about that oil baby. Guyana has it and Venezuela wants it. By annexing the western part of Guyana they would be able to claim a large portion of the oil that is offshore. 

While the people of Venezuela voted for an invasion, I believe the chance of it happening is slim, and if they did decide to invade Guyana it would be a disaster. 

Logistically, a full-scale ground invasion would be near impossible. There are no paved roads into Guyana from Venezuela and the Essequibo region is a dense jungle. The only paved road into Guyana from Venezuela runs through Brazil, and the Brazilian government has sent troops to the border to protect it. 

Technically the Venezuelans could invade by sea, but Guyana is heavily backed by the West. In December, the British deployed an aircraft carrier to sit off the coast of Guyana, and Biden has sent Antony Blinken and other officials down multiple times to reaffirm support for Guyana’s sovereignty. 

One of the most telling pieces of information came from an interview on CNBC with the Exxon CEO. Darren Woods was asked point blank if he believed Venezuela was going to invade Guyana, and what risks he felt that lent to their business. 

His response was promising. Woods is “not sure Guyana is standing on its own”, alluding to what one can only assume is promises the US government has made to protect their interests in Guyana. 

I’m not going into all the details of this conflict in this post, but if you want to learn more about why Venezuela wants to invade Guyana, I highly recommend this video by the Caspian Report.

What I’m doing about it: 

I few months ago I got connected with Cody Shirk. Cody is an investor, writer, and explorer of emerging and frontier markets. Cody has been covering the opportunities in Guyana since as early as 2019.

Cody introduced me to the opportunity, and after connecting with him my excitement about what’s going on in Guyana has kicked up to a new level. 

Next month, I’m headed down to Guyana with Cody and his Explorer Partnership to see what the opportunity looks like with my own eyes.

I will be reporting back on my findings from the ground!  

The Lifestyle:

🌎 Global Adventure:

Need a new book? I just finished this inspiring memoir with the founder of Abercrombie & Kent, the world’s best luxury safari company. It’s a story of adventure, entrepreneurship, and not taking no for an answer (link)

Looking for a writing retreat? Check out this stunning Airbnb on a beautiful lake in one of the most peaceful parts of Washington (link)

Want to see wild tigers by day and then sleep in silk sheets at night? This is quite possibly the greatest luxury hotel on earth (link)

💰Wealth, Business, and Life:

This is the best time to start a company in 30 years. Here’s why (link)

An incredibly helpful framework for making business decisions (link)