ExxonMobil makes another oil discovery but keeps Guyana in the dark on true Stabroek Block figures

Mar 16, 2024 ExxonMobil, News, Oil & Gas

Map of the Stabroek Block

Kaieteur News – ExxonMobil Guyana Limited (EMGL) on Friday announced another oil discovery in the Stabroek Block.

The company said in a statement that the Bluefin well encountered approximately 197 feet (60 metres) of hydrocarbon-bearing sandstone and was drilled by the Stena Drillmax drillship in 4,244 feet (1,294 metres) of water.

The Bluefin well is located approximately 8.5 kilometres southeast of the Sailfin-1 well, in the southeastern portion of the Stabroek block.

This is the company’s first discovery for 2024 and the 41^st successful oil find in the prolific Stabroek Block since 2015. It also marks the 8^th discovery since the last resource update was done in the Stabroek Block.

President of EMGL, Alistair Routledge said, “Our exploration program continues to improve our understanding of the block’s potential to drive viable oil-and-gas development. This latest find reinforces that we have the people, skills and technology to safely and responsibly deliver value to Guyana from the country’s resources.”

Meanwhile, the Ministry of Natural Resources in a separate statement welcomed the new discovery. It noted, “The Government of Guyana reaffirms its commitment to prudently managing the nation’s oil and gas sector for the upliftment of all of its citizens.”

Despite the discovery announcement, the company provided no update on the estimated recoverable resources in the block. In the early days of exploration activities however, the oil company’s discovery announcements shared detailed information on the recoverable oil estimates.

For instance when Exxon announced its sixth discovery, Ranger-1, in January 2018, it said in a statement, “The Ranger-1 well discovery adds to previous world-class discoveries at Liza, Payara, Snoek, Liza Deep and Turbot, which are estimated to total more than 3.2 billion recoverable oil-equivalent barrels.”

This newspaper previously reported that the company’s last resource count, dated April 26, 2022, declared the recoverable resource for the Stabroek Block at nearly 11 billion oil-equivalent barrels.

ExxonMobil had said the company is no longer focused on providing updates on the number of barrels added to its resource base, but on monetizing those resources.

The chief policy maker for the sector, Vice President Bharrat Jagdeo had agreed with the company’s position to hide the new discovery figures from the public.

During a press conference at Office of the President, the Vice President said the question of Exxon’s update of the resources is not as serious an issue as it is being made out to be by some industry stakeholders. He said Exxon’s announcement, or lack thereof, will not change the fact that there is a discovery already there for the benefit for the country.

“It’s just a matter of timing when we increase our reserves or not…In fact, they (Exxon) have a greater kind of need to do that because globally… they look at your reserve and that helps to move stock prices for Exxon but they’ve decided that they want to focus more on appraisals as to how many barrels are in these discoveries, etc,” said the Vice President. Overall, he said Exxon’s move to focus on monetizing the discovered resources is a logical step.

Senior Vice President of Exxon Mobil Corporation, Neil Chapman later disclosed during the Morgan Stanley’s Energy and Power Conference earlier this month that appraisal works were being conducted by the company to understand the resources discovered.

Chapman said, “We have six drilling ships in the basin in pretty close proximity. And these drill ships are doing a combination of what I call exploration drilling, appraisal drilling and development drilling.”

In the realm of oil and gas, companies undertake a process known to the industry as appraisal to help the developer determine whether or not a project is viable. This process helps to reduce the range of uncertainty in the volumes of hydrocarbons in place; define the size and configuration of the reservoir and collect data for the prediction of the performance of the reservoir during the forecasted production life.

This therefore means that Exxon has deliberately decided not to update the nation on the true value of its offshore resources and also has the blessings of government to instead rush to pump the country’s oil.

The Stabroek Block is Guyana’s largest oil block, measuring 6.6 million acres or 26,800 square kilometers. The block is operated by ExxonMobil Guyana which holds a 45% stake, while its Co-Venturers, Hess Guyana Exploration Ltd. holds 30 percent interest and CNOOC Petroleum Guyana Limited holds 25 percent interest.