Exxon announces largest oil find to date in Stabroek block

Jan 06, 2018 News

The Stabroek block area controlled by ExxonMobil and its partners.

Another well drilled at the offshore concessions of US-owned ExxonMobil and its partners, has struck more high quality oil.

Yesterday, in separate announcements by both the Government of Guyana and ExxonMobil, it was disclosed that a more than 230 feet of a high-quality oil reservoir was discovered during a drill at the Ranger-1 well.

The sixth discovery in Guyana since 2015, it would push the estimated amount of oil past the 3.2B barrels found so far in the Stabroek concessions.

According to Government, in a statement, in partnership with Esso Exploration and Production Guyana Limited, CNOOC Nexen Petroleum Guyana Limited and Hess Guyana Exploration Limited, it “is pleased and gratified by the information that more than 230 feet of high quality oil bearing reservoir has been discovered at the Ranger-1 well in the Stabroek block. This represents the sixth discovery in Guyana since 2015.”

This latest discovery is also being hailed as the largest single find to date and adds to the quantities which have been confirmed in the five previous finds.

“The news of an additional find of this magnitude, particularly, at the start of the new year, can be seen as a further blessing and underscores the richness and diversity of Guyana’s natural resources. Managed prudently, these resources will allow for an enormous transformational effect on the lives of every Guyanese in the years ahead,” the Government statement said.

“The Ministry of Natural Resources is particularly pleased that its strategy of engagement with Esso Exploration/CNOOC/Hess and its partners is leading to bountiful discoveries, and overall, the Government is elated that Esso Exploration/CNOOC/Hess remain ahead of their exploration schedule for the entire Stabroek block.”
The ministry said that it expects “other international operators” will draw confidence from Esso Exploration/CNOOC/Hess’s presence, and these six finds, and diligently pursue their own exploratory work programmes.

Several companies have advanced their seismic data collection and are expected to drill in 2018, Government said.

“The Government remains committed to all efforts for the safe and efficient development of the offshore Guyana basin. Finally, government calls on all stakeholders to act responsibly and patriotically, as Guyana continues its thrust into this new sector, and as news and events continue to unfold about the extent of the oil reserves offshore and the manifold opportunities and benefits for the Guyanese people.”
In a release also, ExxonMobil noted that the Ranger-1 well discovery adds to previous world-class discoveries at Liza, Payara, Snoek, Liza Deep and Turbot, which are estimated to total more than 3.2 billion recoverable oil-equivalent barrels.

ExxonMobil affiliate – Esso Exploration and Production Guyana Ltd.- began drilling the Ranger-1 well on November 5, 2017 and “encountered approximately 230 feet (70 meters) of high-quality, oil-bearing carbonate reservoir. The well was safely drilled to 21,161 feet (6,450 meters) depth in 8,973 feet (2,735 meters) of water.”

The Bahamian-registered vessel which will be refitted to be the floating production storage and offloading (FPSO) facility for the Liza1 project – oil production is set to start in 2020.

Steve Greenlee, President of ExxonMobil Exploration Company, insisted that “this latest success operating in Guyana’s significant water depths illustrates our ultra deep-water and carbonate exploration capabilities.”

In fact, this latest discovery proves a new play concept for the 6.6 million-acre Stabroek block, and adds further value to the company’s growing Guyana portfolio.

Following completion of the Ranger-1 well, the Stena Carron drillship will move to the Pacora prospect, four miles from the Payara discovery.

Additional exploration drilling is planned on the Stabroek block for 2018, including potential appraisal drilling at the Ranger discovery.

The Stabroek Block is 6.6 million acres (26,800 square kilometers).

Esso Exploration and Production Guyana Limited is the operator and holds 45 percent interest in the Stabroek Block. Hess Guyana Exploration Ltd. holds 30 percent interest and CNOOC Nexen Petroleum Guyana Limited holds 25 percent interest.

ExxonMobil, the largest publicly traded international energy company, is targeting 2020 for the start of Guyana’s commercial production.

The announcement would come about two weeks after the administration released the contract of ExxonMobil and partners which confirmed that Guyana is getting a two percent royalty on every barrel of oil pumped. Under the deal, Guyana is supposed to split the profits 50/50.

However, there has been deep worry about Guyana’s capacity to check on ExxonMobil’s accounting, as that operator and its partners have the right to reclaim its investments.

Government is now putting systems in place to verify those costs.

Already, SBM Offshore has been awarded the contract to undertake the floating production storage and offloading (FPSO) facility.

The Bahamas-flagged Tina VLCC was selected by SBM Offshore for the conversion.

The Stabroek block discoveries have been hailed as among the most significant oil finds in years and would put Guyana on the map in the industry.