Exxonmobil Confirms Major Oil Find Off Guyana

Kingston, 30 June — ExxonMobil's second exploration well on the Stabroek block off Guyana confirms a "world-class discovery" with a recoverable resource of 800mn-1.4bn bl of oil equivalent (boe), the company said today.

The crude portion of the discovery has a light quality of 32°API, ExxonMobil told Argus.

The Liza-2 well, located 193km (120mi) off Guyana's coast, is the second well drilled by ExxonMobil on Stabroek. In May 2015, the US major said it made a "substantial" oil discovery at the Liza-1 well.

The company plans to drill a third exploration well, dubbed Skipjack, next month.

Skipjack will be drilled by the Stena Carron drillship that has been working Liza-2, ExxonMobil says.

ExxonMobil subsidiary Esso Exploration and Production Guyana spud Liza-2 on 5 February 2016, approximately 3.3km from the Liza-1.

Liza-2 found more than 190ft (58m) of oil-bearing sandstone reservoirs in Upper Cretaceous formations, the company said. The well was drilled to 17,963ft in 5,551ft of water.

ExxonMobil operates Stabroek with a 45pc stake. US independent Hess holds 30pc and Chinese state-owned CNOOC unit Nexen the remaining 25pc.

"We are excited by the results of a production test of the Liza 2 well, which confirms the presence of high-quality oil from the same high-porosity sandstone reservoirs that we saw in the Liza 1 well completed in 2015," ExxonMobil president Steve Greenlee said in the company's statement. "We, along with our co-venturers, look forward to continuing a strong partnership with the government of Guyana to further evaluate the commercial potential for this exciting prospect."

Stabroek is part of the Essequibo region over which neighboring Venezuela has long claimed sovereignty in a century-old border dispute. The Essequibo covers the western two-thirds of Guyana. Caracas earlier objected to ExxonMobil's work on the block.

Caracas has not commented on ExxonMobil's new drilling results.

Guyana produces no oil or gas, and the dispute over Essequibo led Venezuela to suspend shipments of up to 5,000 b/d of refined oil products to Guyana under the government´s PetroCaribe preferential oil supply program. Guyana now imports products from Trinidad and Tobago.

Venezuela also stopped accepting Guyanese rice as part payment for PetroCaribe imports.

ExxonMobil expanded its presence in Guyana when it took a 35pc interest in the offshore Canje block in February 2016 following an agreement with block holders Canadian junior JHI Associates and local firm Mid-Atlantic Oil and Gas.

Canje lies 300km offshore and north of Stabroek.

Source: Argus Media
Date: Jul 1, 2016