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Exxon to submit field development plan for 6th oil project next month

Sep 17, 2023 ExxonMobil, News, Oil & Gas

Kaieteur News – In the government’s 2023 Mid-Year Report, it was announced that the field development plan (FDP) for the Whiptail Project is set to be submitted this October. The US$13B project is ExxonMobil’s sixth proposed development in the Stabroek Block.

The government said it has actively engaged with ExxonMobil, having participated in two pre-FDP discussions in April and June. These conversations seek to streamline the proposed developments and align them with the country’s policies. Vice-President, Dr. Bharrat Jagdeo recently highlighted the government’s policy positions for the Whiptail Production Licence. Notably, he said new policies will ensure ExxonMobil provides prompt data. Additionally, he said there will be greater emphasis on safety during offshore operations and the imperative use of cutting-edge technology to mitigate carbon emissions.

During the recent Barclays CEO Energy-Power Conference, the Chief Executive Officer of Hess Corporation, John Hess said the co-venturers expect approval of the project in early 2024. Front-end engineering and design (FEED) work has also commenced for the project and will inform the field development plan.

According to project documents, Whiptail will be capable of producing 250,000 barrels of crude per day (bpd). The floating production, storage, and offloading (FPSO) vessel will have an oil storage capacity of 2 million barrels. It will be able to offload crude to a tanker every three to six days, once the project is producing optimally.

Diving deeper into the Whiptail Project’s specifics, it is set to tap into three oil fields: Whiptail, Pinktail, and Tilapia. The project’s ambitious scope targets between 33 and 72 wells in the Stabroek Block. Oil production is optimistically projected to kick off between the last quarter of 2027 and the first half of 2028, promising a production life of at least 20 years. The project’s US$13B budget is a staggering US$13 billion and is ExxonMobil’s priciest proposal yet.

Such sizable investments, while indicative of ExxonMobil’s confidence in the Whiptail Project, also mean a significant amount of expenses need to be recouped before Guyana starts to see higher profits from these ventures. Current projects, Liza Phases One and Two, are already yielding almost 400,000 barrels of oil per day (bpd). With another development called Payara that is set to commence production by the end of this year and Yellowtail and Uaru in the pipeline for 2025 and 2026, Guyana will be producing more than 1.2 million bpd by the time Whiptail starts in 2027.

There is also speculation about ExxonMobil’s seventh project in the region. Reports indicate this will be in the Fangtooth area, given that it is undergoing active appraisal.

ExxonMobil, the operator of the Stabroek Block with a 45% stake, is collaborating on projects in the deepwater concession with Hess, which holds a 30% stake, and CNOOC with a 25% share.

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