Guyana inches closer to oil production…ExxonMobil awards contracts for floating vessel

Dec 21, 2016 News

ExxonMobil subsidiary, Esso Exploration and Production Guyana Limited (EEPGL), yesterday

Neil Duffin, president of ExxonMobil Development Company.

announced that it has awarded contracts to SBM Offshore for a floating production, storage and offloading (FPSO) vessel, a key step in moving the Liza field toward first production.
Under the contracts, SBM Offshore will perform front end engineering and design for the FPSO, and, subject to a final investment decision on the project in 2017, will construct, install and operate the vessel.
“Liza development activities are steadily progressing, and we’re excited to reach this important milestone,” said Neil Duffin, president of ExxonMobil Development Company. “We look forward to working with the government of Guyana to develop its valuable resources, which have the potential to provide long-term, sustainable benefits to the country.”
ExxonMobil submitted an application for a production license and its initial development plan for the Liza field in early December. The development plan, submitted to Guyana’s Ministry of Natural Resources, includes development drilling, operation of the FPSO, and subsea, umbilical, riser and flowline systems.
Last May, ExxonMobil announced that it had struck oil in significant quantities in the offshore concessions. One other well confirmed the find with a third being drilled at the moment.
The Liza field has a potential recoverable resource estimate in excess of 1 billion oil-equivalent barrels and is located in the Stabroek block approximately 120 miles (193 kilometers) offshore Guyana.
The Stabroek block currently comprises 6.6 million acres (26,800 square kilometers). Esso Exploration and Production Guyana Limited is the operator and holds a 45 percent interest in the Stabroek block. Hess Guyana Exploration Ltd. holds a 30 percent interest, and CNOOC Nexen Petroleum Guyana Limited holds a 25 percent interest.
The find is the first major one for Guyana that will be commercially exploited.
With little experience in handling oil production, Guyana has started building capacity with a number of international companies providing training on oil spills, negotiations and other aspects of oil industry.

ExxonMobil’s subsidiary, Esso, has awarded contracts for a floating vessel to produce, store and offloading oil from Guyana. (SBM Offshore photo)

Government has announced the establishment of a Sovereign Wealth Fund to handle the proceeds from not only oil but other extractive industries.
Guyana is banking heavily on the oil find to lift the country’s fortunes, which has been heavily dependent on gold, rice, sugar, fish and timber exports for revenues.
The oil find will come when world prices have fallen but are expected to improve as top producers reduced production to ease a glut on the market.
The find has raise hopes with high interest by other explorers.
US-owned ExxonMobil, the largest publicly traded international oil and gas company, is said to be the largest refiner and marketer of petroleum products, and its chemical company is one of the largest in the world.