Exxon eyes another ‘mega basin’ in Stabroek Block with new discoveries

Jul 31, 2021 News

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…shareholders told Yellowtail permits expected before year-end

Kaieteur News – The recent discoveries in the Stabroek Block in Guyana’s Exclusive Economic Zone (EEZ) at the Whiptail I & II wells have boosted Exxon executives’ confidence as it relates to the projected size and quality of the new basin east of the Liza Field Development.

This would bring the proven reserves in Guyana’s deepwater developments, well over the already confirmed nine billion barrels of oil equivalent.
The disclosures were had yesterday when ExxonMobil Executives—Chairman and Chief Executive Officer (CEO), Darren Woods, Senior Vice President, Jack Williams and the US oil major’s Vice President and Secretary, Stephen Littleton—briefed shareholders on the company’s second quarter 2021 financial performance and operations.
Williams in his briefing, told shareholders, the two new discoveries will add to the proven nine billion barrels resources, “further increasing confidence in the size and quality” of the reserves east of the Liza developments.
He told shareholders that in addition to 167 feet (51 meters) of net pay in high quality oil-bearing sandstone reservoirs encountered at the Whiptail-2 well, drilling continues as it is believed to bear even more crude at deeper depths.
The Whiptail 2 discovery, announced this past week, represents just one of three successful wells spud this year in the Stabroek Block, according to Williams and referenced the Whiptail-1 discovery in addition to the Longtail discovery announced earlier this year. Appraisals, he said, are ongoing.
Meanwhile, as it relates to the Liza Unity, the second Floating, Production, Storage and Offloading vessel meant for the Liza II development in the Stabroek Block, Williams announced that its arrival in Guyana, is now set for the fourth quarter of this year.
The ExxonMobil official did not provide a reason however for the pushed back arrival date, since the vessel—according to previous official pronouncements—was supposed to have arrived in Guyana the beginning of the third quarter of the year.
Updating officials on its Guyana operations, shareholders were also told that pending government approvals, which are expected before the end of this year, the company intends to formally ink its Final Investment Decision (FID) for the Yellowtail oilfield, also before the end of the year.
This would pave the way for the company to formally begin inking contracts for the development of this fourth oilfield. That would represent the fourth oilfield to be developed in the Stabroek Block by the operator, Esso Exploration and Production Guyana Limited (EEPGL)—and its partners Hess Corporation Guyana and China National Offshore Oil Company (CNOOC).
The Payara development is on track, according to Williams, who told shareholders the FPSO for that development—Prosperity—is currently having its topsides being installed.
Providing an update on its second quarter performance generally, shareholders were told that earnings for the period was some US$4.7 billion, compared with a loss of US$1.1 billion in the second quarter of 2020.
Second-quarter capital and exploration expenditures were said to be US$3.8 billion, bringing the first half of 2021 to US$6.9 billion, which is consistent with planned lower activity in the first half of the year.
According to CEO, Woods, the company anticipates higher second half planned spending on key
projects, including Guyana, Brazil, Permian and in Chemical, with full-year spending towards the lower end of the guidance range of $16 billion to $19 billion.
It was noted that the company’s oil-equivalent production in the second quarter was 3.6 million barrels per day, down two percent from the second quarter of 2020, which the company attributed to increased maintenance activity.
It was noted that “excluding entitlement effects, divestments, and government mandates, oil-equivalent production increased 3%, including growth in the Permian and Guyana.”
Speaking directly to the company’s Guyana portfolio, it was noted that ExxonMobil continued to progress its major deepwater developments in Guyana, including the announcement of new discoveries at Uaru-2, Longtail-3, and Whiptail, “which increased confidence in the quality and size of the resource and supports.”
It was noted too that their exploration, appraisal, and development drilling continues, with a total of six drill ships now operating offshore Guyana.
Describing its Guyana projects as the “company’s high-return developments” remain on schedule, with Liza Phase II on target for 2022 startup, Payara on schedule for 2024 startup and Yellowtail targeted for 2025 startup.

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