Govt. open to look beyond Exxon on natural gas project

Govt. open to look beyond Exxon on natural gas project – Patterson

Dec 29, 2017 News

…says it’s more than power generation

Minister of Public Infrastructure, David Patterson

Minister of Public Infrastructure, David Patterson says that the Government is receptive to working with companies other than U.S. oil giant, ExxonMobil, to land a natural gas pipeline to shore as part of a massive industrial development plan.

ExxonMobil’s oil discovery in the Liza offshore well in 2015 includes associated natural gas. As such, the Guyana Government commenced and continues preliminary discussions with ExxonMobil on bringing gas to shore.

At the Ministry’s end of year press conference yesterday, the Minister disclosed that a final location to land the pipeline has not been determined. He stated that they are exploring sites in Regions Three and Four, although a site in Region Six has not been ruled out.

Patterson noted that the determination of the site could be made by the end of the first quarter of 2018. The decision, he said, will be guided by several factors that include land availability, surrounding population and environmental studies.

According to the Minister, once a final decision has been made on the location to land the pipeline, a further in-depth analysis will be undertaken.

“The actual construction of the pipeline has not been decided and that is why we need a location. If you decide to go in one location, the technical challenges are different from others. So we need to have a preferred location so we can do the technical studies that will determine how we move forward,” Patterson explained.

Earlier this year, Government contracted Energy Narrative for US$70,000 to conduct a study on the utilisation of natural gas for electricity generation. According to Patterson, ExxonMobil has also retained a company to undertake a similar study, while other companies, including a Japanese firm, are also examining the prospect of using natural gas to meet energy needs.

Government has been holding discussions with several stakeholders, including ExxonMobil, on the best use of natural gas. There are suggestions that ExxonMobil would be the obvious choice on natural gas since the company has an existing production sharing agreement with the government on extracting oil from the Liza field.

Minister Patterson stated that Government is open to working with other companies on the natural gas.

“We have not ruled out any other companies,” Patterson stated.

ExxonMobil officials have told Kaieteur News that the majority of the associated gas for Liza Phase 1 will be used for re-injection to maintain pressure in the reservoir to increase production of oil. The company is currently evaluating with the Government a potential project to provide 30-50 thousand standard cubic feet per day on shore.

“It’s far bigger than the pipeline,” Patterson declared. He pointed out that the pipeline is not only for electricity, but it is also for an industrial park that includes a liquid petroleum gas (LPG) plant.