Routledge parrots VP Jagdeo on no significant increase of Guyana’s oil reserves

May 01, 2024 ExxonMobil, News, Oil & Gas

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Kaieteur News – Although eight new discoveries were made since Guyana’s last resource update in April 2022, with one of those estimated to hold some 746 million barrels of oil, ExxonMobil Guyana Limited (EMGL) has repeated the words of Vice President Bharrat Jagdeo that there is no significant update to the country’s estimated 11 billion barrels of recoverable resources.

President of ExxonMobil Guyana Limited (EMGL), Alistair Routledge on Tuesday sought to clarify reports and comments on there being no update to the country’s reserves since 2022.

He was at the time engaging the media at the company’s Duke Street, Kingston, Georgetown office.

The Country Manager first made a distinction between oil reserves and resources. He explained, “When we have a better ability to understand that through looking at concepts, the number of wells and testing of the reservoirs then we are able to move to greater certainty and the greater certainty we have is when we sanction a new project as we did with Whiptail. That is when we start to call them reserves. We are now at the point where we can consider that these are going to be developed and produced so its reserves not resource.”

To this end, Routledge said that the six sanctioned projects in the Stabroek Block are estimated to hold some 4.8 billion barrels of oil reserves.

Describing the process to determine oil reserves as an “ongoing complex exercise,” the Country Manager pointed out that the company has been providing quarterly updates to the government on the estimated recoverable resources.

“We provide quarterly updates to the government, that number hasn’t moved hugely in the recent months but it is something that we continue to look at and we update the government,” Routledge said.

He was keen to note that the oil giant’s focus is to move the resource to reserves since this generates revenue for the country. Routledge referenced neighbouring Suriname, highlighting that that country has an estimated five billion oil equivalent barrels of discovered recoverable resource, with the first discovery made since 2020. Be that as it may, he reasoned that Suriname has not yet moved to the production stage.

To this end, he explained, “So it’s a nice big number but if you don’t ever convert it to a project, you don’t have reserves, you don’t have revenue. That’s why we said our focus is really shifting, we will continue to explore and look for those opportunities but really the focus is on how do we convert that to value for the country.”

Given the explanation provided by the Country Manager, Kaieteur News asked for an update on how the country’s resources have grown since the 11B barrels estimate in 2022. Since the last resource update, ExxonMobil made eight new discoveries in the Stabroek Block, with one of those discoveries holding an estimated 746 million barrels of oil.

In response to the question, Routledge said, “I think I’ve answered that, it’s the same as what Vice President Bharrat Jagdeo has said, the 11 billion hasn’t significantly changed, we continue to update the government.”

This newspaper pressed the official to provide the most recent figure, however he said, “we are still carrying 11 billion barrels. I can’t tell you exactly what’s in the latest number we gave to the government, I don’t have that number to hand but we continue to do the updates and its around 11 billion oil equivalent barrels but like I said the only time we ever know exactly what that resource number, that reserve number is the day you stop producing.”

In fact, he said that it is quite normal for those numbers to be revised downwards.

“Sometimes those numbers actually come down, we have to re-estimate those as they come down and that’s quite normal in other countries around the world,” the Country Manager noted.

ExxonMobil is the operator of the Stabroek with a 45% stake, with partners CNOOC Ltd and Hess holding interests of 25% and 30%, respectively.

CNOOC in its 2023 Annual Results revealed that the Lancetfish discovery, which was made in April 2023, averaged some 100 million tons, which is equivalent to 746 million barrels, according to the conversion formula of the Independent Petroleum Association of America.

Lancetfish is among the eight discoveries made since the last resource update. Also, yet to be added to the reserves are the Seabob-1 and Kiru-Kiru-1 wells, Sailfin-1, Yarrow-1, Fangtooth SE, Lancetfish-2 wells, and the recently announced Bluefin discovery.

VP Jagdeo during a press conference in April said there is no significant change to the country’s oil reserves.

According to him, “Right now, there is an assumption that the information is being withheld, that’s false. I pointed out to you that we get these reports every three months and the reports that we have state what the reserves are and that has not changed materially over the past maybe year or so, so that’s not withholding information that we have.”

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• ExxonMobil, oil, reserves, resource, update

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