CGX Energy Inc V.OYL

ExxonMobil finds more oil in Stabroek Block

[Devanand1]

Govt reaffirms pledge to manage oil resources for upliftment of citizens

The Stena Drillmax drillship has found oil at the Bluefin well in the Stabroek Block

United States oil major ExxonMobil Guyana has announced another oil discovery at the Bluefin well in the Stabroek Block – the company’s first oil find for 2024.
In a statement issued on Friday, the US oil giant said it encountered approximately 197 feet (60 metres) of hydrocarbon-bearing sandstone in the Bluefin well, which 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, where oil was found in October 2022 in the southeastern portion of the Stabroek block.
“Our exploration programme 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,” President of ExxonMobil Guyana, Alistair Routledge, has said.
The Bluefin discovery joins the more-than 30 other discoveries already made in the Stabroek block since 2015.
Meanwhile, the Guyana Government, through the Natural Resources Ministry, has welcomed the discovery, which marks the 49th oil find offshore Guyana.
“Bluefin joins the other discoveries made in the prolific Stabroek Block from 2015 to date. 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,” the Natural Resources Ministry said in a statement.
The last discovery in the Stabroek Block was made in October 2023, when oil was found at the Lancetfish-2 well. The well encountered approximately 125 feet of net oil pay in appraisal reservoirs, and approximately 65 feet of net oil pay in a new discovery interval.
The Lancetfish-2 well was drilled in 5,649 feet of water, and is located approximately four miles southeast of the Lancetfish-1 discovery well, where oil was found in April last year by the Stabroek Block operator ExxonMobil.
In addition to Lancetfish-1 discovery, the other oil finds in 2023 include at Fangtooth SE-1 in the Stabroek Block and at the Wei-1 well in the Corentyne Block.
Routledge told reporters, last month at a press conference in Georgetown, that the company has plans to drill and appraise at least seven new wells within the Stabroek Block in 2024, including two within the western boundaries of the oil field, named the Trumpetfish and the Redmouth.
Five of the wells are expected to guide the company in assessing the quantity and usability of the natural gas reserve in the Stabroek Block, particularly those in the eastern portion. If the wells lead to commercially viable resources, the company could drill additional wells in the area.
These activities, especially the planned exploration west of the Essequibo River, raise questions about the US oil major’s posture towards the threats coming from Guyana’s western neighbour Venezuela, which is claiming more than two-thirds of Guyana’s landmass and a port of its Exclusive Economic Zone (EEZ), where most of the oil finds have occurred.
However, Routledge has reiterated that the company remains dedicated to its Guyana operations, and has expressed, “We remain committed to Guyana and pursuing business here, and delivering on the commitments we’ve made…
“We believe that the contract that we have with the country is valid under the local law…Also, under international law, we have valid rights to the blocks in which we’re participating, and the issue between countries needs to be dealt with as it is being done between the government between the two countries”.
ExxonMobil, through its local subsidiary Esso Exploration and Production Guyana Limited (EEPGL), has a majority 45 per cent interest in the Stabroek Block, and is the operator; while Hess Corporation holds a 30 per cent interest, and CNOOC Petroleum Guyana Limited, a wholly-owned subsidiary of CNOOC Limited, holds the remaining 25 per cent interest. However, Hess Corporation has agreed to merge with Chevron, and this transaction is expected to be closed in the first half of this year – a transaction that could be delayed after Exxon filed arbitration proceedings to claim preemptive rights in the offshore Guyana operations.
ExxonMobil, along with its co-venturers, had commenced production activities in the Stabroek Block in December 2019. Currently, production has been ramped up to over 600,000 barrels of oil per day at the Liza Phases One and Two, as well as the Payara projects, all of account for the three floating, production, storage and offloading (FPSO) vessels operating in Guyana’s waters offshore.
The current production figures would be further buttressed by the Yellowtail and Uaru developments, which are already underway and are anticipated to contribute 250,000 barrels of oil each following their respective start-ups in 2025 and 2026.
An application for the sixth development, the Whiptail Project, was submitted by the Stabroek Block operator to the Guyana Government last year, and is awaiting the necessary approvals. This project, once approved, would see Guyana producing just over 1.2 million barrels of oil per day by 2027.
In addition to these six projects offshore Guyana, which Exxon anticipates would be online by 2027, the possibility of having 10 FPSOs operational by 2030 is also being eyed.