New discovery pushes oil reserves over 5B barrels Suppliers jostle for jobs as local content forum begins

Dec 04, 2018 News

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Local companies are meeting with ExxonMobil and its contractors to talk jobs and opportunities as the countdown continues for first oil in early 2020.
Yesterday, scores gathered at the Marriott Hotel, Kingston, as news was announced that a 10th discovery has been made about 200 kilometers offshore, pushing recoverable reserves beyond five billion barrels of oil.

This could push production up to 750,000 barrels per day come 2025, authorities said yesterday.
While the forum was in the first session, a statement from Government quoted Director, Department of Energy, Dr. Mark Bynoe, as saying that the United States oil giant, ExxonMobil, has made its 10th discovery offshore Guyana, at the Pluma-1 well.
“This is great news for Guyana…The country is on the cusp of transformational development for current and future generations and the news of ExxonMobil’s 10th discovery offshore Guyana is expected to facilitate the country’s realisation of substantial social and economic improvements,” said an upbeat Dr. Bynoe.
The Pluma-1, which is located some 17 miles (27 kilometers) south of the Turbot-1 well and follows previous discoveries on the Stabroek Block, encountered approximately 121 feet (37 meters) of high-quality, hydrocarbon-bearing sandstone.
The well was safely drilled to 16,447 feet (5, 013 meters) depth in 3,340 feet (1,018 meters) of water. The Noble Tom Madden drillship began drilling on November 1, 2018.
“Guyana is well poised to truly forge ahead in the 21st century. As a petro-development state we will, however, need to strategically invest in a people-centered and balanced manner, where we utilise our non-renewable resources for structural transformation and improving people’s lives in the short-term, while concomitantly providing the foundation to allow us to transition in the medium- and long-term to a post carbon economy,” Bynoe noted.
The previous recoverable resource estimate on the Stabroek Block was more than four billion barrels.
The government statement said that this discovery reinforces the potential of the country being able to produce more than 750,000 barrels of oil daily by 2025 and to the potential for development in the south-east section of the Stabroek Block.

The Stabroek Block is 26,800 square kilometers, Dr. Bynoe added.
The Noble Tom Madden is expected to begin drilling the Tilapia-1 prospect located some 3.4miles (5.5 kilometers) west of the Longtail-1 well. The Stena Carron drillship recently completed operations at Hammerhead-1 and will soon drill its next well following scheduled maintenance.
ExxonMobil and its affiliate Esso Exploration and Production Guyana Limited hold 45 per cent interest in the Stabroek Block. Hess Guyana Exploration Limited holds 30 per cent interest and CNOOC Nexen Petroleum Guyana Limited holds 25 per cent interest.
Meanwhile, the Liza Phase 1-Supplier Development Forum at the Marriott allowed debate on the highly controversial local content issue- in layman’s words it is what jobs and opportunities that Guyana is getting.
Yesterday’s forum was supposed to allow local companies and partners to mingle with ExxonMobil and its contractors.
The contractors included Noble Drilling, TechnipFMC, Saipem, SBM, Schlumberger, Halliburton, and Guyana Shore Base.
The suppliers also making presentations were Modern Building Solutions, Guysons Oil and Gas, Falcon Logistics and Atlantic Marine Supplies.
Today, the booths would be opened, allowing for participants to interact with the contractors and suppliers.
According to Joanna Simmons-Homer, of the Department of Energy, with little experience in the oil and gas sector, there will be a few success stories emerging from companies which has grabbed opportunities.
The official told the packed Marriott room of private sector officials, and business executives, that the government’s local content policy is nearer to reality with finishing touches being added.
Chairman of the Private Sector Commission, Desmond Sears, expressed delight that the Centre For Local Business Development has taken the initiative for the forum.
The Centre, located in the compound of the Institute of Private Enterprise Development, South Road, provides space for local firms to learn about opportunities in the oil and gas sector, strengthen their competitiveness, and prepare to supply the oil and gas sector with various services. This happens through registration, training and other forums.
According to Sears, while Guyana welcomes investors, there are rules and ethics that must be adhered to. He too called for a local content policy to be introduced soonest with the time window of grabbing opportunities costing monies.

He pointed to deep interest of local businesses in the oil sector with delegations visiting Aberdeen, Scotland and Newfoundland, Canada.
Sears noted that the range for services and supplies would be wide– from pumps to tools and boats.
He urged that a list of supplies be made available so that local businesses can determine if they can get a piece of the pie.
The PSC official stressed, too, that Guyana has boasted of a positive growth in the last decade, with agriculture, mining and forestry leading the way.
The new entrants must play a role in helping Guyana move to the next level, he urged.
Meanwhile, ExxonMobil’s Country Manager, Rod Henson, stressed that local supplies are critical to the oil operations.
He insisted that ExxonMobil is bent in honoring the environmental and other commitments.
The centre, he says, is helping companies understand the importance of best practices in a high-stakes game.
Henson also warned that in a high-stakes game, there is little room for waste and inefficiency.
ExxonMobil, he urged, needs suppliers who meet the required objectives and are prepared to work in what will be a first class industry.
A floating platform to store pumped oil for transfer has already been ordered and is to arrive in Guyana for late summer next year.
Locals have been hired for the drill ships that ExxonMobil has used and on land, a number of operations have started up in preparation where persons have been employed.
However, ExxonMobil is being heavily criticized for its deal with Guyana which included a 50/50 profit on oil and two percent on every barrel sold.
However, there has been deep worry about the 50/50 split with ExxonMobil recording a dismal track record of not playing fair with its figures.

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