Latest update December 16th, 2024 9:00 AM
Hess to pump over US$570M into Stabroek Block for 2019
Hess Corporation’s 2019 Exploration and Production budget will see it expending over US$500M in the Stabroek Block in which it holds a 30 percent interest.
According to Greg Hill, Chief Operating Officer (COO) for Hess, 2019 will be the peak spend year for the Liza phase one development, which is on track for first oil by early 2020.
He noted as well that Hess is poised to begin the Liza Phase Two Development spending, complete the plan of development for Payara, and advance frontend engineering and design work for future development phases.
This newspaper understands that Hess has put aside US$260 million for costs associated with the Liza Phase One development offshore Guyana while its US$310 million budget includes spending for Liza Phase 2 development, the plan of development for Payara, and frontend engineering and design work.
The sum of US$440 million is also planned for drill exploration and appraisal wells on the Stabroek Block. Funds are also included for seismic acquisition and processing in Guyana, Suriname and the deep water Gulf of Mexico, and for other licence acquisitions.
Map showing the locations of Exxon’s 13 discoveries (Sourced from Hess Corp)
According to Environmental Protection Agency (EPA) documents, oil production from the Liza Phase Two Development is expected to last at least 20 years. ExxonMobil’s subsidiary, Esso Exploration and Production Guyana Limited (EEPGL) will drill approximately 35-40 wells offshore to support extraction of the oil from below the sea floor.
Each well will be drilled to a depth over 5,000 metres (m) below the sea floor. EEPGL will then install some of the oil production facilities on the sea floor at approximately 1500-1900 m (4900-6200 ft) water depth.
These subsea facilities include various types of pipes and hardware. The subsea facilities allow the oil from the wells to be gathered and moved to the surface of the ocean for further processing.
Kaieteur News understands that EEPGL will install other oil production facilities on a Floating Production, Storage, and Offloading (FPSO). The FPSO will be moored on location in approximately 1,600 m (5250 ft) of water depth and will remain on location throughout the life of the facility.
Oil production facilities on the FPSO will further process the oil extracted from below the sea floor. The FPSO will have the capacity to produce approximately 190,000 to 220,000 barrels of oil per day. During the early stage of production operations, the FPSO is anticipated to produce an average of approximately 5,700,000 to 6,600,000 barrels of crude oil per month.
At peak, EPA documents note that EEPGL will utilise approximately 1,200 personnel offshore during the stage where the wells are being drilled and the offshore oil production facilities are being installed. Kaieteur News understands that this number will decrease to less than 200 personnel during the production operations phase. A smaller number of personnel will then be utilised at the onshore support facilities.
According to reports perused by this newspaper, there are some key differences between the Liza Phase Two Development and the Liza Phase One Development.
In the area of Oil Production Rates, the Phase Two production rate will be approximately 190,000 to 220,000 barrels of oil per day while Phase One’s production rate is 100,000 barrels of oil per day with the ability to operate at sustained peaks of 120,000 barrels per day.
With respect to FPSO Oil Storage Volume, Phase Two storage volume will be approximately 1.6 to 2 million barrels, depending on the hull selected. Phase One storage volume is 1.6 million barrels.
In terms of the number of wells, Phase Two will have approximately 35-40 wells. Phase One has 17 wells.
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