Exxon seeks permit to drill 35 new wells in Stabroek Block

Jul 18, 2022 News

…exact locations not identified, EPA orders cumulative impact assessment

Kaieteur News – Esso Exploration and Production Guyana Limited (EEPGL), the local subsidiary of ExxonMobil, has submitted an application to the Environmental Protection Agency (EPA) to launch another 35 well drilling campaign in the resource rich Stabroek Block, offshore Guyana.

The Project Summary for the ambitious campaign was uploaded to the regulator’s website on Friday last, while the Screening Report compiled by the EPA for the project was uploaded on the said day, but amended and updated on Sunday.

The document explains that EEPGL- the Stabroek Block operator- is acting on behalf of itself and China National Offshore Oil Corporation (CNOOC) Petroleum Guyana Limited, and Hess Guyana Exploration Limited in seeking an Environmental Authorization to carry out the activities.

Notably, “The exact locations of the 35 exploration/appraisal wells comprising the Project have not yet been finalized. While some of the 35 wells will be drilled for exploration purposes, it is also possible that some of the wells may be drilled as appraisal wells within the proximity of previously drilled exploration areas. Therefore, four areas of interest have been identified within the Stabroek Block as the possible locations for the proposed 35 exploration/appraisal wells to occur.”

The Stabroek Block is located approximately 200 kilometers offshore in Guyana waters, where EEPGL has conducted substantial exploration and development activities to date. If discoveries are found at particular locations, Kaieteur News understands that subsequent wells could be drilled in the vicinity of such locations to further assess the commerciality of the discoveries. As such, EEPGL outlined that its priorities and schedules could therefore change. The oil company said it will continue to submit the well information necessary to obtain approval for an Environmental Permit from the Guyana EPA.

EEPGL, commonly referred to as ExxonMobil Guyana, intends to commence the 35 well campaign in the third quarter of 2023, signaling that if discoveries are made, well tests may be performed. Conclusion of the proposed drilling campaign is expected by the fourth quarter of 2028. ExxonMobil Guyana made it clear that “This schedule is preliminary and could be influenced by new discoveries, determination of the need for sidetracks, and/or well tests—all of which could extend the drilling period for the Project. The same factors could also influence the locations and sequence of subsequent wells.”

The company added that the process of drilling these wells will be very similar to the process followed during prior EEPGL exploration drilling campaigns and may include mobilization, drilling, ancillary processes (possibly including sidetracks, well tests, and/or vertical seismic profiling), and demobilization. Exxon has not yet determined the order in which the wells will be drilled as specific features and activities for each well are still being finalized. It noted that the details will be finalized and provided to the EPA in advance of the spudding activities.

EEPGL currently has six drill ships operating offshore Guyana: the Stena Carron, the Stena DrillMAX, the Noble Bob Douglas, the Noble Tom Madden, the Noble Don Taylor, and the Noble Sam Croft. The wells could be drilled by any one of these six drill ships. The oil company disclosed that all of the drill ships are fully equipped for such drilling operations. Further, if a well test is determined to be warranted for the Project, the well would likely be temporarily plugged and abandoned to enable the return of a drill ship to re-enter the well and complete the well test at a later date. Once exploration/appraisal drilling activities are complete, the wells will be plugged and abandoned.

The drilling of the exploration/appraisal well(s) in the Stabroek Block is expected to potentially occur simultaneously with other drilling activities, including: The Liza Phase 1 Project well drilling and production operations; The Liza Phase 2 Development Project well drilling program and production operations; The Payara Development Project well drilling program, installation, and start of production; Ongoing exploration/appraisal well drilling operations in the Stabroek Block covered under a 25-well campaign approved on 1 October 2019; The Yellowtail Development Project well drilling program and installation operations; and two 12 well campaigns in the Kaieteur and Canje oil blocks for which environmental authorization is currently being sought.
As such, the EPA has ordered that a Cumulative Impact Assessment (CIA) be conducted.

In the regulator’s screening report, it was explained “It can be concluded based on the existing data, technical review and exercise of discretion that the environmental and human impacts from the proposed 35 multi-well exploratory and appraisal drilling are known.”

EPA noted that while the likelihood of some of the impacts from the project were noted to be high, the severity of these impacts’ ranges from low to medium, once mitigation measures outlined, are implemented. “However, it is noted that while the activity by itself may not have a significant impact on the environment, similar activities carried out in the Stabroek Block may have significantly affected the environment. Thus, given the number of exploratory projects that have occurred in the Stabroek Block and oil production projects that are currently ongoing in the same block, then in accordance with Section 17 (1)1 , it is recommended that an environmental impact assessment of the cumulative effects of project be conducted,” the EPA determined.

The Screening Report was keen to note that the project will be placed on a 30 days Public Notice to allow for the public to share their concerns or possible objections. To this end, once there are no objections or appeals on the EPA ruling from the public, the decision of the Agency shall be communicated to the developer.