ExxonMobil exposed by Stabroek Block partner

Apr 29, 2021 News

– says gas leak interrupted production

Kaieteur News – Chief Executive Officer (CEO) of Hess Corporation, John Hess, yesterday spilled the proverbial beans on the Stabroek Block operations when he disclosed that on April 11, last, oil production was curtailed for several days after a gas leak was detected in the Flash Gas Compressor’s discharge silencer onboard the Liza Destiny’s Floating, Production, Storage and Offloading (FPSO) vessel.

Hess Corporation CEO, John Hess.

ExxonMobil the operator in the Stabroek Block had, in announcing the problem, alluded to problems encountered but did not disclose that it was in fact, a dangerous gas leak that had curtailed the operations briefly.
Hess gave the disclosure during the first quarter earnings call held for his company’s shareholders.
According to Hess, production at Liza Phase One had run at its full capacity of 120,000 gross barrels of oil per day during the first quarter of the year up until the leak.

Hess Corporation’s Chief Operating Officer, Greg Hill.

Production, he said, has since ramped back up and is expected to remain in the range of 100,000 to 110,000 gross barrels of oil per day, until repairs to the discharge silencer are completed in the next three months.
Following the repairs, he said “production is expected to return to, or above [the] Liza Destiny’s nameplate capacity of 120,000 barrels of oil per day.”
The Company’s Chief Operating Officer, Gregory Hill, in addressing the gas leak for shareholders, disclosed that SBM Offshore—the FPSO builder—has already placed an order for an upgraded flash gas compression system, which is expected to be installed in the fourth quarter of 2021.
As such, he projected that production optimisation work is now planned in the fourth quarter which will further increase the Liza Destiny Production capacity.
According to Hill, “I think it’s important to note that the overall performance at the subsurface of Liza One has been outstanding.”
He noted that, “we have seen very strong reservoir and well performance that has met or exceeded our expectations.”
As such, according to Hill, “once the flash gas compressor is replaced, we are confident that we will see a significant improvement in uptime reliability.”
He disclosed that “upon reinstallation and restart of the flash gas compression system—expected in approximately three months—production is expected to return to or above nameplate capacity of 120,000 barrels of oil per day.”
According to Hill, the damaged flash gas compressor is now in Houston, Texas, where it is “being torn down and looked at with the expectation that it will be restored within the next three months.”
He posited, “…once that happens, then we’ll get back to that 120,000 barrels a day plus.”
Additionally, he pointed out that in the fourth quarter of this year, ExxonMobil is going to replace the existing flash gas compressor with some of the components that have been redesigned, “so that shutdown in the fourth quarter—about 14 days—will accomplish those few things.”
Meanwhile CEO Hess, in his presentation to shareholders used the occasion to reaffirm, “Guyana is positioned to become a significant cash engine, as multiple phases of low cost oil development come online, which we expect will drive our portfolio breakeven Brent oil price, below $40 by the middle of the decade.”
As such, Hess revealed that “more than 80 percent of this year’s capital spending is allocated to Guyana where our three sanctioned oil developments have a breakeven oil price of between $25 and $35 per barrel.”

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