Latest update December 17th, 2024 3:32 AM
Investors concerned about Guyana press reports calling for renegotiation of Stabroek Block deal
– Hess says Govt. has assured contract will remain untouched
Kaieteur News – Media reports documenting the unrelenting calls by various stakeholders for changes to some of the poor terms in the 2016 Stabroek Block Production Sharing Agreement (PSA) have caught the attention of investors for Hess Corporation- one of ExxonMobil’s partners operating here.
Hess Corporation CEO, John Hess
At the 51st Annual Scotia Howard Weil Energy Conference yesterday, Chief Executive Officer (CEO), John Hess was asked to address these calls for renegotiation and the risk they pose. Though there have been calls for an increased royalty and for the inclusion of provisions that would close avenues for abuse, Hess said emphatically that investors have nothing to worry about.
“I think it is important for everyone to know that President (Dr. Irfaan) Ali and (Vice President) Bharrat Jagdeo, they are pro-business and they have been very clear to us and Exxon that they are going to honour the PSA that we have in the country. They want us to develop their resource as fast as possible so that they can develop the economy and ensure economic prosperity for the Guyanese people,” Hess told investors.
The CEO noted that while they will “hear noise from time to time about the PSA”, Hess and Exxon which run the Stabroek Block alongside CNOOC Petroleum Guyana Limited have been reassured time and again that the contract will remain untouched. “They want us to go as fast as possible so they can take the oil treasure and make it the people’s treasure,” the CEO stated.
ExxonMobil Corporation through its subsidiary, Esso Exploration and Production Guyana Limited (EEPGL) is operating in the nation’s waters at historic speeds. It is not only breaking records with the pace at which it receives approval from government for its projects but it is also to do expansive exploration programmes.
The Environmental Protection Agency (EPA) is currently reviewing Exxon’s environmental plans for a fifth project called Uaru in the Stabroek Block. The oil giant has also commenced the process to draft its Environmental Impact Assessment (EIA) for a sixth project called Whiptail. Government has already set aside money to cover the cost of reviewing that document later this year.
In the meantime, Exxon has approached the EPA to review a 35 well programme in the Stabroek Block. That is expected to commence this year should the company receive the requisite authorisation.
This newspaper understands that the exact locations of the 35 wells comprising the project have not been finalised. While some of the 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. Onshore logistical support facilities and marine/aviation services will be used to support the project.
EEPGL has also said it will use proven and good international industry practices and has incorporated many embedded controls into the overall project design to reduce environmental and socioeconomic impacts. Kaieteur News understands that it could take several years to drill the wells, currently scheduled from the third quarter of 2023 through 2028.
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