ExxonMobil’s 5th project to cost Guyana US$12.6B

Jan 10, 2023 News

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– Could produce 300,000 barrels of oil per day following 2027 start-up

Kaieteur News – ExxonMobil Corporation’s fifth project at the Uaru-Mako field which holds over 1.3 billion barrels of oil in the Stabroek Block is expected to cost Guyana over GY$2.6 Trillion (US$12B).

Project details for the latest venture by Exxon’s subsidiary, Esso Exploration and Production Guyana Limited (EEPGL) are currently under review by the Environmental Protection Agency (EPA).

The Environmental Impact Assessment (EIA) states that the Uaru Development Project will develop the Uaru, Mako and Snoek oil-rich fields with the potential to develop other resources within the Licence area.

The project scope includes drilling approximately 38-63 development wells; installation and operation of Subsea Umbilicals, Risers, and Flowlines (SURF) equipment, and installation and operation of a Floating Production, Storage, and Offloading (FPSO) vessel.

EEPGL has not yet made a Final Investment Decision on the project, and is continuing to evaluate cost considerations during the project development process. For the purposes of the Uaru Development Project Environmental Authorisation process, EEPGL said the cost is estimated to be $2.638 trillion GYD ($12.683 billion USD).

A preliminary schedule anticipates that FPSO and other fabrication and installation works will begin in 2024 following the completion of engineering and will take approximately three years. Development well drilling may also occur during this period. Production operations are expected to begin in 2027 and will continue for at least 20 years.

With respect to the FPSO, EEPGL’s Environmental Impact Assessment states that oil production will average at 250,000 barrels of oil per day. It was keen to note that peak rates may be higher during the lifetime of the project, depending on multiple factors such as reservoir pressure, number of wells, equipment reliability etc. It states at page 146, “Currently, the FPSO basic design has an upper production limit of 263,000 BPD (42,080 m3) peak oil production rate. For the purposes of the EIA, production up to 300,000 bpd is considered to assess potential impacts from the project and cover potential production optimization after facility start up. If during the detailed design stage or during production operations an opportunity to expand the upper production limit arises, the project will document the evaluation and justification and an updated upper production limit will be available.”

It was also noted that the project will be producing 540 million standard cubic feet of gas per day.

Importantly, telecommunications equipment will also be installed on the FPSO to enable safe operation of the facilities in normal and emergency conditions. Kaieteur News understands that this equipment will allow communication with the offices, shorebases, support vessels, helicopters, and tankers, as well as communication within the FPSO.

EEPGL had previously installed the Fibre Optic Cable Project, which provides the fibre optic communication infrastructure from the Stabroek Block to shore, enabling high-speed, low-latency communications and data transfer between EEPGL’s FPSOs and shore.

The fibre Optic Cable Project included installation of two optical distribution units (ODUs), two main fibre optic trunk lines to shore, and fibre optic cables routed from the Destiny, Unity, Prosperity, and One Guyana FPSOs to the ODUs.

EEPGL plans to connect this Project’s FPSO into the existing fibre optic infrastructure back to shore, which will consist of two fibre optic cables connected from a Uaru subsea drill centre back to the existing two ODUs. From the Uaru subsea drill centre, the fibre optic cable will connect to the Uaru FPSO via one of the dynamic umbilicals, which will contain fibre strands.

In terms of employment, it was noted that there will be a demand of up to 540 persons required to drill and complete the Uaru development wells. Kaieteur News understands that the majority of these personnel will work in the offshore environment on drill ships. In addition, there will be between 10 and 15 trips per week of the support vessels that will be assisting the different drill ships. Most of these roles will require prior offshore oil and gas industry experience and specialized expertise. However, the prior development of the Liza Phase 1, Liza Phase 2, Payara and Yellowtail Projects has resulted in continuous capacity building of the workforce, as additional personnel are upskilled and given greater responsibilities.

The EIA states that this will create opportunities to increase the pool of semi-skilled and skilled workers that can support the project.

During long-term production operations, the in-country, direct offshore workforce will peak at around 100 to 160 people during periods of higher maintenance activity and during offloading of an FPSO.

The EIA also states that during periods of regular operations, the workforce requirement on an FPSO is estimated to be on the order of 90 to 100 people.

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• environmental, ExxonMobil, gas, Guyana, oil, Projects, Yellowtail

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