Exxon’s 6th project to continue dangerous trend of exceeding EIA production estimates

Sep 14, 2023 ExxonMobil, News, Oil & Gas

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Kaieteur News – Already producing oil at two Floating Production Storage and Offloading (FPSO) vessels above the safety limits outlined in the projects’ Environmental Impact Assessments (EIAs), ExxonMobil Guyana Limited (EMGL) is hoping to continue this trend at its sixth oil project in the Stabroek Block, Whiptail.

This was revealed by EMGL Projects Manager, Anthony Jackson during a public consultation hosted at the Leonora Technical Institute, West Coast Demerara on Tuesday. Jackson was at the time responding to a query from this newspaper when he explained that Exxon has developed a process with the Government of Guyana (GoG) that allows it to produce above the number outlined in the respective impact studies.

Notably, an EIA is a technical study done by a specialist group that assesses likely impacts from the development, based on specifics of the project- in this case, the number of barrels to be produced per day. It therefore means that the impacts of the project were determined by the daily estimated production rate. This would help the consultant to estimate the volume of waste to be discharged, the expected pollutants such as Green House Gas (GHG) emissions and perhaps more importantly, the level of devastation that can result from a spill. These variables are then considered by Guyana’s Environmental Protection Agency (EPA) that will ultimately decide whether the project should be permitted.

Given that the EIA forms the foundation for the approval of a Permit, stakeholders have been arguing the need for this key document to be respected and for production figures outlined to be maintained.

ExxonMobil however admitted that the company has been producing oil at the two FPSO’s in operation, Liza Destiny and Liza Unity above the production figures outlined in the EIAs. Jackson told the gathering, “we have engaged in optimization of both the Unity and the Destiny FPSOs so they are both producing at a higher (rate) than what was the initial Field Development Plan base assumption of the window of what has been agreed with the government.”

He went on to explain, “As part of the process, once we start a facility, is to do optimization and there is two ways that that’s optimized.” The Projects Manager noted that when production commences and hydrocarbons are initially introduced to the facility, it does not start at its full capacity. Instead he said the company would commence oil production in a phased manner “so there is an optimization of when the facility will reach plateau from the planned startup wells in the facility.”

When it comes to the sixth project, he said, “there’s a second optimization which I would say is testing if the facility is working optimally or if there is capacity to go beyond, say the 250,000 barrels per day that we talked about today…we will study the process facilities across the FPSOs and understand if, within safe limits of the machinery that underpins each process, if they can handle additional fluids and if they can handle additional fluids, as long as it’s within the production rates that we agreed in the Field Development Plans, we can go up to those limits and if we are to see the potential to go beyond pre-established limits then they will go back to the government to request potential increases beyond those rates.”

In a subsequent interview with Kaieteur News, Jackson was reminded that ExxonMobil Guyana has been producing oil beyond the safety limits outlined in the EIAs. To this end, he clarified that the company has been engaging with the government to approve production beyond the EIA estimates.

“With Liza Phase One and Liza Phase Two we have been engaging with the government on each step of ‘hey we see capacity to go beyond what was the original funding basis or the investment decision basis like we have a, there’s an investment decision basis we will put into our funding documents and that will go to the government as well and then we will have technical limits that we talk about a bit more in the FDP or in the EIA and if we start to approach those limits, we will go to government and say hey we have the ability to go further,” Jackson said, adding: “We have something or a process that has been established between us and the government.”

This process, according to the Projects Manager, affords the company an opportunity to share its assessments with government on its ability to increase production rates. Notably, government is then empowered to decide whether the company should proceed with the breach to the EIA or whether the company should stick to the approved production rates.  Jackson said, “I’m not fully aware if we have seen a contradiction of what the basis for the FDP or the EIA and if there was a need to go back to those processes; can’t say yes or no personally on that.”

Ramped up production

The Liza Destiny was the country’s first FPSO and was designed to safely produce 120,000 barrels per day (bpd), however the GoG in its Mid-Year Report on the performance of the economy said that production has been ramped up to 153,000 bpd.

Meanwhile, on the second FPSO, Liza Unity, which was designed according to its Environmental Impact Assessment (EIA), to produce up to 220,000 barrels per day, production has been pushed to about 226,500 bpd.

Plans are already in place to further increase the daily production at the two FPSOs.

Similarly, the third project, Payara which is expected to start up in the fourth quarter of this year, Exxon has said that it plans to produce about 230,000 bpd by the end of 2024 at the project alone. https://kaieteurnewsonline.com/2023/08/09/daily-production-at-3rd-project-to-be-increased/

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• EIA, oil, production, ramp-up, Whiptail

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