Exxon says NO to increase in royalties for any new Stabroek Block projects

Feb 10, 2023 News

Kaieteur News – Head of ExxonMobil Guyana, Alistair Routledge has shut the door on the possibility of giving Guyanese the slightest increase in royalty on any of its Stabroek Block projects.

At a press conference held yesterday at his company’s Kingstown office, Routledge said Exxon is doing extensive appraisal and exploration work in the area around the Fangtooth discovery in the block. He said this is to define a potential seventh development project.

Given that it is wrapped up in discussions with the Guyana government for permission to move ahead with a fifth and sixth project, and is already eyeing a seventh, Kaieteur News asked if Exxon would be willing to renegotiate on a royalty higher than the current two percent for one of those ventures.

Routledge said, “At the end of the day, the projects are not getting any easier, so yes we have line of sight to number six and we see the costs on the world market inflating and for number seven we don’t have full line of sight yet. We have mentioned the discovery in the Fangtooth area where we have a very active exploration and appraisal in that area but it is a slightly bigger resource in that area and we don’t have the same surety that we can actually make it work but it would be premature to even think about that discussion.”

Kaieteur News then asked pointedly if his answer boils down to a “no” to which Routledge answered in the affirmative.

This newspaper previously reported that ExxonMobil Guyana currently has four sanctioned developments on the Stabroek Block. The Liza Phase One and Phase Two developments are currently operating at their combined gross production capacity of more than 380,000 barrels of oil per day.

The third development at the Payara field is on track to come online at the end of 2023 utilizing the Prosperity floating, production, storage and offloading (FPSO) vessel with a production capacity of approximately 220,000 gross barrels of oil per day.

The fourth development, Yellowtail, is expected to come online in 2025, utilizing the ONE GUYANA FPSO with a production capacity of approximately 250,000 gross barrels of oil per day.

A Plan of Development for the fifth development at the Uaru field is awaiting regulatory approval. It is expected to come online at the end of 2026 with a gross production capacity of approximately 250,000 barrels of oil per day.

Discussions have already commenced for a sixth project at the Whiptail discovery.

The Stabroek Block is 6.6 million acres. ExxonMobil affiliate Esso Exploration and Production Guyana Limited (EEPGL) is operator and holds 45 percent interest in the Stabroek Block. Hess Guyana Exploration Ltd. holds 30 percent interest and CNOOC Petroleum Guyana Limited holds 25 percent interest.

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Alistair Routledge, ExxonMobil, Liza Phase One, ONE GUYANA FPSO, Stabroek Block

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