Guyana is sitting on a jackpot of liquid gold.

In 2015, the oil giant Exxon Mobil discovered 11 billion barrels of oil off the coast of the small Latin American country. The discovery promises to change Guyana forever, catapulting the country and its people to new heights of power and wealth. Oil already generates US$1 billion in revenues annually for the government and will produce an estimated US$7.5 billion by 2040. By these forecasts, Guyana—the impoverished, rainforest-covered country of just 800,000 people—will become the fourth largest offshore oil producer in the world.

But there are doubts. Questions abound over whether Guyana is prepared to manage this influx of wealth. Some critics contend that Guyana lacks the legal framework and expertise to regulate the oil bonanza, and many similar developing countries—such as neighboring Venezuela—have also struck vast oil deposits, only to be left poorer and more politically unstable than before.

This uncertainty can be segmented into three main concerns. First, can Guyana’s democracy and economy survive the oil boom? Second, can Guyana survive the effect of oil money on its ethnically divided population? Third, given the coastal country’s vulnerability to climate change, is it responsible to drill for more oil?

Tiny Country, Tremendous Oil

Abundant natural resources can spark huge economic growth. However, in many developing countries, mining these valuable resources paradoxically leaves the countries worse off, with weaker economies and democracies. Economists call this phenomenon the resource curse, and it afflicts many countries throughout Latin America and beyond. Guyana’s oil discovery makes the potential for a resource curse a serious concern for the country as oil floods in.