…daily oil production could be ramped up to 1.2M BoE
ExxonMobil and its partners have said they anticipate six Floating Production, Storage and Offloading Vessels (FPSOs) operating in Guyana’s waters by 2027. However, the results of an appraisal on one well — the Fangtooth well — could see the number of planned FPSOs increased to seven.
This was revealed by Hess Corporation Chief Executive Officer (CEO) John Hess, during a Goldman Sachs energy conference. Hess Corp is part of a consortium of oil companies that include ExxonMobil, the operator of the Stabroek Block, and CNOOC Petroleum Guyana Limited.
According to Hess, it is evident that the consortium has been dealt one of the best hands in the oil industry when it comes to the Stabroek Block. He explained that the multiple wells they plan to drill this year could become either standalone discoveries or tiebacks. In fact, Fangtooth itself could have the potential to turn into a seventh FPSO, which would increase daily oil production to over 1.2 million barrels of oil equivalent (BoE).
“When I say there are multi-billion barrels remaining, there’s a significant amount in terms of billions of barrels remaining potential in the deep. And we’re going to be drilling some wells this year, that are going to be further extensions of that,” Hess said.
“It’s either standalone or tieback. We think Fangtooth has the potential, subject to the appraisal that we’re drilling one well now and another well later in the year, that Fangtooth itself could potentially be the seventh boat.”
The Fangtooth-1 well hit oil in January 2022, around the same time as Exxon’s Lau-Lau-1 oil discovery. Exxon had said at the time that a positive result would allow it to test deeper exploration targets in the Stabroek Block. And that is not all. The nine discoveries last year do not even factor into the 11 billion barrels of oil in the Stabroek Block.
“We had nine discoveries last year, 30 discoveries that we’ve had overall underpinning the 11 billion barrels of oil equivalent. The nine discoveries we had last year is not in that 11-billion-barrel equivalent, so there’s upside. We’re also starting to drill the deeper horizons. The 18,000 feet that is Fangtooth that we drilled last year. That was the first deeper horizon, 18,000 feet, versus the majority of the discoveries and production at 15,000 feet.
“Fangtooth came in, we’re doing an appraisal of Fangtooth as we speak. Hopefully, we can give an update on our quarterly call at the end of January. But we see a decent amount of potential at the deeper horizons for those sand channels that we already have at 15,000 feet. So, when we talk about resource duration, we’ve grown from 1-billion-barrel oil equivalent to 11-billion-barrel oil equivalent. There are multi-billion barrels remaining,” Hess said.
Guyana, with US oil giant ExxonMobil as the operator, began producing oil on December 20, 2019, in the Stabroek Block. Guyana’s oil revenues are being held in the Natural Resource Fund (NRF) at the New York Federal Reserve Bank, where it is earning interest.
The oi- rich Stabroek Block, which is producing the oil, is 6.6 million acres (26,800 square kilometres). Exxon, through its local subsidiary Esso Exploration and Production Guyana Limited (EEPGL), is the operator and holds 45 per cent interest in the Block. Hess Guyana Exploration Ltd holds 30 per cent interest, and CNOOC Petroleum Guyana Limited, a wholly-owned subsidiary of CNOOC Limited, holds the remaining 25 per cent interest.
ExxonMobil has said it anticipated at least six projects offshore Guyana would be online by 2027, with production having already started in the second phase, with the Liza Unity FPSO vessel in operation.
The third project –the Payara development – will target an estimated resource base of about 600 million oil-equivalent barrels, and was at one point considered to be the largest single planned investment in the history of Guyana.
Meanwhile, the Yellowtail development, which will be oil giant ExxonMobil’s fourth development in Guyana’s waters, will turn out to be the single largest development so far in terms of barrels per day (bpd)of oil, with a mammoth 250,000 bpd targeted. (Jarryl Bryan)
