Guyana to inaugurate natural gas exports from its offshore fields
By Reuters
GEORGETOWN — Guyana's revenue from oil exports and royalties this year is expected to climb 31% to $1.63 billion, Finance Minister Ashni Singh said on Jan. 16, on higher output from the addition of a third production facility near year-end.
The South American nation also plans to inaugurate natural gas exports from its offshore fields, with at least 50 MMcf/d to be sold from the two production vessels currently in service, Singh said.
At the Jan. 16 presentation of the country's budget for this year, the finance minister called 2022 "a major year for exploration," with 11 oil exploration wells drilled and 10 new commercial discoveries.
The drilling results drove the nation's reserves to more than 11 Bbbl of recoverable oil. The country's oil production could reach some 810,000 bbl/d by 2025 with the startup of the third production vessel, he said.
A consortium led by US producer Exxon Mobil is responsible for all the country's oil output. [See sidebar story below]
The nation's oil and gas sector is estimated to have expanded by 125% last year, with a total of 101.4 MMbbl of oil produced, compared with 42.7 MMbbl in 2021.
The county's Natural Resource Fund held $1.27 billion at the end of 2022 after withdrawing about $608 million to finance state development priorities, Singh said.
The government separately plans to evaluate this quarter a total of nine bids received through a competitive process for building an oil refinery in the country, he said.
01.18.2023
Exxon set to order 5th Guyana oil vessel, sizing up more blocks
By Sabrina Valle, Reuters
HOUSTON — Exxon Mobil is preparing to approve its fifth oil production project in Guyana and is considering taking additional exploration acreage, the head of its Guyanese operations, Alistair Routledge, told Reuters in an interview.
The efforts would add significantly to the $30 billion committed thus far by Exxon and Guyana partners Hess and CNOOC. The latest development will cost about 27% more than the last, a new estimate showed, reflecting inflation and the larger scope of the project.
The consortium aims to pump 1.2 MMbbl of oil and gas per day by 2027 from all the developments, according to Hess, nearly triple last year's peak output.
Guyana has emerged as the world's fastest-growing oil region since Exxon made its first offshore discovery in 2015. The consortium has found about 11 Bbbl of oil and gas. Guyana estimates its fields could hold 25 Bbbl and aims to produce 1.64 MMbbl/d by the end of the decade.
The development will cost about $12.68 billion, according to an estimate prepared for Guyana's Environmental Protection Agency, 27% more than Exxon's fourth development. Its oil would start flowing in 2027 and continue for 20 years, according to the Guyana government's estimate.
Guyana last week estimated the project would require up to 600 workers at the peak of drilling activity, and employ up to 160 people thereafter. The project will release about 1 million tons per year of carbon dioxide emissions, it forecast.
Exxon has submitted a development plan for the oilfield, and an initial construction contract was awarded last fall to Japan's Modec Inc. If the plan is approved by Guyana's government, the consortium could sanction spending on the project about April, Routledge said.
April is when Guyana is due to hold its first competitive auction for new exploration areas. Exxon will consider bids on new blocks, the country chief said.
"Of course, we will look at it," Routledge said, adding "it would be premature to say yes or no" to participation before the country releases the full terms of new production contracts.
The country disclosed last year a fiscal regime which raises Guyana's share of oil riches to 27.5%, from 14.5%, through a mix of royalties and shared production. But it has yet to update the production sharing agreement for the blocks. Companies are weighing their own geological data on the areas.
More competition?
Exxon and its partners inaugurated Guyana's production in 2019 and today deliver all the oil output in country, from their 6.6-million-acre (26,800 sq km) Stabroek block.
Areas on offer could potentially double the offshore acreage under exploration by the Exxon consortium. Licenses will cost between $10 million for the 11 blocks in shallow water, and $20 million for the three in ultradeepwater. The 14 blocks up for grabs cover about 2,000 sq km each.
The government wants the auction to reduce its dependence on Exxon and partners, which have become the lynchpin in a transformation to industrial from agriculture-based economy.
Guyana President Mohamed Irfaan Ali visited India last week to try to entice private companies and the government to join its oil business. Joint technical groups will explore bilateral cooperation, Ali said.
"Apart from the auction, we are discussing government-to-government partnership in a number of areas including exploration," Ali said.
