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Stabroek Block will create tremendous value for shareholders -Hess Corp. CEO
“Stabroek wells can be drilled in one third of the time and cost less than those in the Gulf of deep water Mexico…It will yield higher financial returns and more rapid cash paybacks, all proving that the Block is truly in a class of its own.”
When the Liza complex of the Stabroek Block is compared with other deep-water provinces around the world, it emerges as the best in the industry, says Chief Executive Officer (CEO) of Hess Corporation, John Hess.
He made this declaration at the Bernstein 35th Annual Strategic Decisions Conference, which was held in New York a few weeks ago. There, the CEO told investors that the Liza complex is expected to create tremendous value for Hess shareholders for many years to come.
Hess said that Guyana’s Stabroek Block discoveries are some of the industry’s largest of the past decade while noting that the reservoirs rank among the highest quality in the world. He noted that the high porosity and permeability of the reservoirs are expected to deliver very high production rates.
Hess Corporation CEO, John Hess
Map showing discoveries on the Stabroek block to date
Also, since producing horizons are relatively shallow, the CEO said that the wells can be drilled in one-third of the time. It will also cost less than those in the Gulf of deep-water Mexico.
“Guyana is truly a transformational investment opportunity for Hess,” said the CEO.
Excited about his firm’s bright prospects, the official even compared Guyana and the Delaware Basin and the analysis shows that Guyana offers a lower cost of development, higher financial returns and more rapid cash paybacks, all proving that the Stabroek Block is truly in a class of its own.
CONSIDERABLE PROGRESS
The development of Liza Phase One is making considerable progress. Company officials have since noted that development drilling began in May for the first of 17 wells planned for Phase One. This they said would lay the foundation for production startup in 2020. ExxonMobil representatives also noted that in partnership with Hess Guyana Exploration Limited and CNOOC Nexen Petroleum Guyana Limited, they have so far discovered recoverable resources of more than 5.5 billion oil-equivalent barrels in the Stabroek Block.
Liza Phase One is expected to generate over $7 billion in royalty and profit oil revenues for Guyana over the life of the project. The project involves the conversion of an oil tanker into a floating, production, storage and offloading (FPSO) vessel named Liza Destiny, along with four undersea drill centers with 17 production wells. Construction of the FPSO and subsea equipment is under way in more than 12 countries.
Additionally, ExxonMobil officials have since said that Liza Destiny will have a production capacity of 120,000 barrels of oil per day. A second FPSO with a capacity of 220,000 barrels per day is being planned as part of the Liza Phase Two development, and a third is under consideration for the Payara development. Together, ExxonMobil said that these three developments will produce more than 500,000 barrels of oil per day.
The Stabroek Block is 6.6 million acres (26,800 square kilometers). Esso Exploration and Production Guyana Limited is the main operator and holds 45 percent interest. Hess Guyana Exploration Ltd. holds 30 percent interest and CNOOC Nexen Petroleum Guyana Limited holds 25 percent interest.
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