— historic oil production begins offshore Guyana

US OIL COMPANY ExxonMobil and its co-venturers Hess and CNOOC have begun oil production offshore Guyana ahead of schedule and less than five years after the discovery of hydrocarbons in commercial quantities here, Director, Department of Energy, Dr. Mark Bynoe announced today.

“This historic development for the Co-operative Republic of Guyana (CRG) is a culmination of substantial investments, perseverance, dedication, ingenuity, and the establishment of the appropriate policy environment that has the capacity to propel our nation towards sustained development.  Guyana’s future is bright, but we can only secure that future by strengthening legislation, conducting due diligence, emphasising education, following a balanced development paradigm and utilising the best skills in the industry through partnerships,” said Dr. Bynoe.

Dr. Bynoe explained that production from the first phase of the Liza field, located in the Stabroek Block, is expected to reach full capacity of 120,000 barrels of oil per day in coming months with the first cargo set to be sold sometime in January 2020.

“It is also imperative that as Guyanese we begin to appreciate that the direct and indirect benefits from this sector will go far beyond anything that we have seen to date.  The Department of Energy, therefore, will continue to utilise prudence and best practices to ensure that we extract the best value for our people. This for us is a dream realised,” Dr. Bynoe said.

The Liza Phase I development project features the Liza Destiny floating, production, storage and offloading (FPSO) vessel moored 190 kilometres offshore Guyana, and four subsea drill centres supporting 17 wells.

The Liza Unity, a second FPSO with a capacity to produce up to 220,000 barrels of oil per day is being constructed to support the Liza Phase 2 development. Front-end engineering design is underway for a potential third FPSO, the Prosperity, which is geared at developing the Payara field upon Government and regulatory approvals.

The current discovered recoverable resource for the Stabroek Block is more than 6 billion oil equivalent barrels. It is anticipated that by 2025 there would be at least five FPSOs producing more than 750,000 barrels of oil daily from the Stabroek Block.

Meanwhile, earlier in this year, US media giant, Bloomberg, had reported that Guyana’s reserves would make it Organisation of the Petroleum Exporting Countries (OPEC)’s 12th-largest member after Angola.

At the time of the compilation of the report, ExxonMobil had projected that there were 5.5 billion barrels of oil equivalent resource in the Stabroek Block based on the finds; however, that figure that has been upgraded to six billion barrels.
Guyana took centre stage at Exxon’s Investor Day meeting at the New York Stock Exchange last March.
“It’s not hard to see why Senior Vice-President Neil Chapman – the exec who’d once described the Stabroek find as a “fairytale” – pointed to a chart featuring estimates from Wood Mackenzie Ltd., an Edinburgh-based energy consulting firm. It showed that Exxon’s Guyana wells will be the most profitable of all new deep-water projects by major oil companies,” it observed.

Guyana’s economy, with a Gross Domestic Product (GDP) of $3.63B, a growth rate of 4.1 per cent in 2018 and 4.6 per cent in 2019, is expected to further grow by 33.5 per cent and 22.9 per cent in 2020 and 2021 respectively.

This was according to the NASDAQ Stock Market, which is an American stock exchange. It is the second-largest stock exchange in the world by market capitalisation, behind only the New York Stock Exchange located in the same city.
Esso Exploration and Production Guyana Limited is operator and holds 45 per cent interest. Hess Guyana Exploration Limited holds 30 per cent interest and CNOOC Petroleum Guyana Limited holds 25 per cent interest.