Exxon to build its own onshore base for Yellowtail Project

Dec 14, 2021 News

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Kaieteur News – Esso Exploration and Production Guyana Limited (EEPGL)—ExxonMobil Guyana—is planning to build its own shore-base to service its fourth development in the Stabroek Block, Yellowtail, despite the fact it is yet to obtain any permits from the Guyana Government.

The disclosure was made this past week by ExxonMobil Guyana President, and Country Manager, Alistair Routledge, during his address to the 231nd Georgetown Chambers of Commerce and Industry’s (GCCI) Award Ceremony which boasted the presence of top local private sector officials.
Also present in the audience were Vice President Bharrat Jagdeo and Subject Minister, Vickram Bharrat.
The announcement was made a week before the promised Local Content Legislation is tabled in the National Assembly.
Addressing the private sector representatives in attendance, the EPPGL official used the occasion to disclose that the company has in fact been relocating its supply chain services to Guyana from neighbouring Trinidad and Tobago.
He said that this was the case with a number of contractors engaged in the operations with the ExxonMobil led consortium that are currently relocating their supply centres to Guyana.
Reminding his listeners that the company is currently in discussions with the Guyana Government with regard to approval for the Yellowtail development, Routledge said the company will be looking to build a shore base to cater for that facility.
Guyana currently boasts one shore base facility, with another on the cards for construction.
Addressing the GCCI gala affair, the ExxonMobil Guyana President said, “as you know, we are currently in discussions with the Government regarding the field development plan for the Yellowtail Project.”
He was at the time emphasizing the role of the private sector in the development of Guyana, and pointed to the operations in the Stabroek Block which, he said, provides a foundation for that growth in domestic capacity.
Reminding of the potential for up to 10 developments in the Stabroek Block, the ExxonMobil Guyana President said that this bodes enormous potential not just for the contractors engaged already, but a host of others.
As such, he disclosed that “to date all of the major international oil and gas contractors have a presence in Guyana and have steadily been moving activities from the United States, Brazil, Trinidad and Tobago to Guyana.”
According to Routledge, “almost the entire supply chain for our offshore activities has been relocated to Guyana.”
This, he said, “has created opportunities for the Guyanese private sector, whether it’s to build out the shore-bases, warehousing, (or) waste treatment facilities.”
To this end, Routledge disclosed that “as we look forward to the projects to come” the company plans to “as part of the Yellowtail Project, we also plan to invest in a project shore-base that will enable an increase in fabrication and load out activities in Guyana.”
According to Routledge the consortium has to date already pumped some US$30B into its operations in the Stabroek Block, with regard to the development of the Liza I, II, Payara and Yellowtail Projects, thus far.
According to Routledge, with the Liza I field producing since December 2019, the second Floating Production Storage and Offloading (FPSO) vessel will come on stream in the New Year, tripling production for Guyana.
The Payara Development, which he said was approved by Government last year, is expected to begin production in 2023.
He was adamant that the money pumped into the Stabroek Block by ExxonMobil will generate billions in revenue in coming years.
Routledge used the occasion to remind that the company has a scope for up to 10 developments in the Stabroek Block in future and pointed to the five discoveries to articulate “who knows where this could go.”
With the oil major boasting of some US$30B being pumped into Guyana, it is poignant to note that Government has, through its failure to audit bills submitted, to pay some US$11B for the Liza I & II projects, in addition to pre-contract costs.
It would mean that ExxonMobil has been deducting money out of cost oil to service those payments, none of which was ever checked and verified by the Guyana Government.
This past month, the political opposition had called the failure on the part of the administration, a dereliction of duty.
Vice President Bharrat Jagdeo, during a recent press briefing, had said the Government is disappointed that it has not been able to push through with critical audits, which cover over US$9B in expenditure for the Stabroek Block’s Liza Phase One and Two Projects.
The Vice President said, “…we have been very disappointed that we have not been able to select a group to do the audit of the post-2017 expenditure by Exxon. The reason is that we didn’t have strong local content. We had two groups, two local groups that came in, but they were not strong enough. We want to build the capacity in Guyana to do this audit. We think that our people have enormous skills, forensic skills and auditing capacity.”
The former President added, “…we’re looking to see if we can’t have an arrangement, where we have a consortium of our local people to come together to do part of this work, while working alongside an international group.”
That position, however, was roundly rejected by a number of civil society organizations, among others.

 

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