Room still exists for Guyana to have a say on oil companies’ spending - TT Expert, Anthony Paul

Room still exists for Guyana to have a say on oil companies’ spending – TT Expert, Anthony Paul

May 18, 2020 News

By Kiana Wilburg

TT Energy Expert, Anthony Paul

The Stabroek Block contract does not contain a single provision, which secures Guyana’s right to approve how much ExxonMobil and its partners intend to spend. In fact, Guyana can only check the oil companies’ bills to ensure the costs incurred were not inflated and that they are in keeping with international benchmarks.
But even with such a gaping loophole in the Stabroek Block deal, Energy Expert and International Consultant, Anthony Paul, said Guyana still has a few good opportunities to increase its influence.
Paul noted that ExxonMobil is moving at break neck speed to monetize its discoveries. In doing so, it will need approval from the government for its Field Development Plans. It is at this point, Paul noted, that Guyana can say, “In exchange for the approval, these are the conditions you have to comply with.”
The Trinidadian Energy Strategist made these and other comments during a recent appearance on Kaieteur Radio’s Programme, Guyana’s Oil and You. There, Paul said the county has numerous opportunities to claw back some of the value lost in the lopsided ExxonMobil deal. He noted, however that this is only doable to the extent that the government has the ability of understanding what it wants and deserves and the confidence to ask for it. He said that at the end of the day, it really boils down to willpower.
The international consultant said, “…If you haven’t got the will power to do it (then more value is lost). And we know when the contract was renegotiated in 2015 -2016; the opportunity was there with different information to make some significant changes. How that occurred gives you a sense of the will to make changes…”
Prior to the 2020 elections saga and the COVID-19 pandemic, ExxonMobil has been pushing for the approval of its Payara Field Development Plan. Once those two issues are behind them, ExxonMobil’s partner on the Stabroek Block, Hess Corporation, said that getting the approval for Payara will be their “number one, two and three priority.”
Payara is a significant project for the Stabroek Block partners. According to documents provided to the Environmental Protection Agency, by ExxonMobil’s subsidiary, Esso Exoploration and Production Guyana Limited (EEPGL), the Payara development will produce up to 180,000 to 220,000 barrels of oil per day and will be located in the eastern area of the Stabroek Block, which is approximately 190 km (118 miles) from Georgetown.
During the early stage of production operations, the FPSO for Payara is anticipated to produce up to an average of approximately 5,700,000 to 6,600,000 barrels of crude oil per month. These estimates are preliminary and are subject to change.
The operator notes that oil production from Payara is expected to last at least 20 years with startup of the facilities expected to occur approximately in mid-2023.
Further to this, it was noted that the Project is expected to employ up to 600 persons during development well drilling, approximately 600 persons at the peak of the installation stage, and up to about 140 persons during production operations.

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