Latest update February 6th, 2025 7:27 AM
ExxonMobil now sees Guyana operations as profits for shareholders …as bulk of Liza 1& II front end spending completed
Kaieteur News-With the bulk of the initial Capital Expenditure for the Liza Phase One aspect of the ExxonMobil led operations in the Stabroek Block completed, the company is now looking to Guyana as one of its key drivers of revenue in the short term, in addition to its assets in the Permian in the US.
The projection takes into account the fact that the Liza Destiny Floating Storage and Production (FPSO) has reached full capacity along with its defunct flash gas compressor repaired.
Analysts have since pointed out that “a great deal of the capex (Capital Expenditure) for the first few phases have already been spent and those phases will begin to throw off significant cash flow.”
It was noted too that with the project now operating at full capacity, capex on the Liza Destiny will now be minimal.
Additionally, the Liza Unity FPSO vessel for the Liza Phase II Project in the Stabroek Block has had its topsides installed. With wells drilled, the ship and infrastructure built and installed on the ship, all that remains on the FPSO is integration and commissioning work, and then to sail from Singapore to Guyana and tie-in.
While production is not expected until 2022, the vast majority of the expensive work for this phase has also been completed.
The Liza Destiny FPSO moored offshore Guyana in the Stabroek Block
The company had also sanctioned its third phase in Guyana as well, which is scheduled to come on-stream in 2024.
According to reports, the company’s cash flow from Phase One and Two will begin to cover the capital costs of future phases, especially given the current oil prices.
The company’s Chief Executive Officer, Darren Woods in his most recent investor day conference had also noted that ExxonMobil’s supply cost in Guyana is only $35 per barrel of oil—which is said to be dramatically below current prices.
This publication understands ExxonMobil, which is the operator for the 6.6 million acres Stabroek Block, is in fact now gearing to a development plan for a fourth project offshore, by the end of the year.
Furthermore, the company recently announced that despite challenges associated with the pandemic, teams working on projects such as Liza Phase Two and Payara have been able to remain on schedule, which will allow for the timely completion of the FPSO units being constructed in Singapore.
“Liza Phase One achieved nameplate capacity in 2020 with reservoir performance above expectations. The hull for Liza Phase Two, the Liza Unity, is in Singapore for the topsides installation and is on schedule for startup in 2022. The Floating Production Storage and Offloading vessel is expected to arrive in Guyanese waters in the second half of 2021.
Payara achieved Final Investment Decision in 2020 with plans to commence production in 2024,” Senior Vice President of Upstream, Neil Chapman, told investors in March last.
It was at this time he reminded of additional exploration successes at the Yellowtail and Redtail prospects and said the company is “confident that this area will progress as our fourth major development on the block.”
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