For the first half of 2024, Guyana has produced 113.5 million barrels of oil, and with increased production from the Prosperity floating, production, storage and offloading (FPSO) vessel, it is expected that production will cross the 220-million-barrel threshold by year-end.
A mid-year report on Guyana’s progress, which has recently been released by the Finance Ministry, has shown how the various economic sectors performed. In a broadcast to the nation from the Kingston seawall bandstand on Saturday, President Dr Irfaan Ali revealed how much the oil sector has grown.
“The petroleum sector grew by 67.1 per cent, with 113.5 million barrels of oil produced in the first six months of this year. The industry is now expected to grow by 56.4 per cent for the entire year,” the President explained.
Further perusal of the report has shown that for the corresponding period in 2023, only 68.7 million barrels had been produced. According to the report, production averaged 624,000 in the first half of this year, almost double the 2023 rate.
“Following the Prosperity floating, production, storage, and offloading vessel (FPSO) startup in November 2023 – the third FPSO – daily production in the Stabroek Block averaged 624,000 barrels per day (bpd) in the first half of this year, compared with approximately 380,000 bpd in the first half of last year,” the report has said.
“Supported largely by higher-than-projected production rates on the Prosperity FPSO, crude oil production is now projected at approximately 228 million barrels this year. As such, the industry is now expected to grow by 56.4 per cent this year, up from 44.7 per cent projected at the time of preparing Budget 2024,” the report added.
The report explains that total export earnings from crude oil amounted to US$9.4 billion in the first half of the year…also an increase of US$4 billion compared to the same period for 2023.
“Together with increased crude oil production, further gains were experienced on account of more favourable oil prices,” the report stated, as it further revealed that global oil prices averaged US$84 per barrel in the first half of this year.
Exxon, through its local subsidiary Esso Exploration Production Guyana Limited (EEPGL), is the operator of the Stabroek Block, 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.
The Liza Phases One and Two and Payara projects, all of which combined are producing over 600,000 barrels of oil per day, account for the three FPSO vessels – Liza Destiny, Liza Unity and Prosperity – operating in Guyana’s Stabroek Block in waters offshore.
Exxon is also undertaking the Yellowtail project (where ongoing installation activities are expected to be concluded in September) in the oil-rich Stabroek block. It is estimated that when the Yellowtail development project comes on stream, production will climb to 810,000 barrels per day (bpd). Exxon has already received approvals for, and is advancing preparatory works on, its fifth and sixth projects, Uaru and Whiptail.
The Whiptail project would see Guyana producing just over 1.2 million barrels of oil per day by 2027. In addition to at least these six projects offshore Guyana, which Exxon anticipates would be online by 2027, Exxon is also eyeing the possibility of having 10 FPSOs being operational by 2030.
ExxonMobil’s seventh development in Guyana’s waters, dubbed the Hammerhead development, would feature up to 30 wells. It is targeting a 2029 start-up, according to documents submitted to the Environmental Protection Agency (EPA), where it awaits approval.
A perusal of the project summary reveals that the development would have between 14 and 30 production and water injection wells. It has been speculated that the project could be approved by next year, with production expected to begin in 2029.
When approval has been granted, it is anticipated that between 120,000 and 180,000 barrels of oil per day will be added to Guyana’s production capacity, while a floating, production, storage and offloading (FPSO) vessel capable of storing between 1.4M and 2 million barrels of oil would be attached to the project.
