Guyana enticing ExxonMobil away from Nigerian onshore wells

Guyana-Suriname Basin, an Atlantic-margin basin located on the northeast coast of South America, is offering ExxonMobil Corp. better terms than Nigeria, hence more investments are flowing there rather than in Nigeria, according to an energy report.

In the report by oilprice.com, titled “Emerging Market Oil: The Sweet Spots with All the New Barrels,” the organisation known as an authority in energy news said that the U.S. oil and gas giant ExxonMobil Corp. and a dozen other companies were working non-stop to not only increase their assets but develop new reserves in the oil venue (Guyana-Suriname Basin).

Guyana-Suriname, located within the border of the Corporative Republic of Guyana, has the potential to be one of the hottest new oil venues in the world, oilprice.com suggests.

The report read, “The offshore Guyana-Suriname Basin, where the largest U.S. oil and gas producer, ExxonMobil Corp., and about a dozen other companies are working non-stop to develop new reserves, has emerged as one of the hottest, if not the hottest, new oil venues in the world today.”

It added that Rystad Energy, a Norwegian energy research and business intelligence company, had predicted that the English-speaking country with a population of less than a million people will “leapfrog the United States over the next decade as one of the world’s largest offshore producers.”

The Guyana basin is projected to be a game changer in the global oil industry, especially if ExxonMobil’s projection of almost 11 billion barrels of oil in a single section of the basin comes true.

The report read, “The Guyana basin, off the northeast coast of South America, is poised to have a major impact on the world oil markets if ExxonMobil’s projection of almost 11 billion barrels of oil in a single section of the basin holds true.”

As of July 2023, Nigeria, Africa’s biggest economy, produced 1.25 million bpd, according to data from the Organization of Petroleum Exporting Countries (OPEC). This number signifies an improvement from the past, when crude oil theft, vandalism, and all forms of economic sabotage negatively impacted the numbers.

“We are not leaving,” a senior executive at ExxonMobil said in 2022. “The deep water in Nigeria remains an attractive opportunity, but it has to compete with other opportunities around the world.”

Stabroek Block offshore Guyana

ExxonMobil affiliate Esso Exploration and Production Guyana Limited is the operator and holds 45 percent of the interest in the Stabroek Block offshore Guyana. Hess Guyana Exploration Ltd. holds 30 percent interest, and CNOOC Petroleum Guyana Limited holds 25 percent interest.

The report stated that by 2027, Exxon and its partners are expected to produce around one million gross barrels per day, an amount that should come from at least six floating production storage and offloading vessels.

It said that “by 2027, Exxon and its partners expect to have at least six Floating Production Storage and Offloading (FPSOs) with a production capacity of more than 1 million gross barrels of oil per day online. That there is potential for up to 10 FPSOs to develop the 11 million barrels of discovered, recoverable resources.”

Furthermore, most of the vessels have been showing growth in production, and with consistency, the projection for 2027 may just be met.

The report read, “Production in the Stabroek block began in December 2019 from the Liza Destiny FPSO vessel, which by the end of 2022 was producing about 150,000 barrels of oil per day (bpd). The Liza Unity FPSO started production during the first quarter of 2022 and hit 220,000 bpd in the fourth quarter of 2022.

“The third major development, Payara, is on schedule for first oil in 2023, targeting 220,000 bpd. Yellowtail, the fourth and largest world-class development project, is expected to begin production in 2025, targeting 250,000 bpd.”