Govt touts earlier-than-expected oil production

…following early arrival of FPSO in Guyana

With the arrival of the Liza Destiny Floating Production and Storage Offloading (FPSO) vessel, both Finance Minister Winston Jordan and Director of the Department of Energy, Dr Mark Bynoe, have talked up the possibility of earlier-than-expected oil production.

During a reception held at the Marriott hotel to commemorate the FPSO’s arrival, Jordan was asked for a timeframe for first oil. In response, the Minister hinted at the possibility that ExxonMobil could begin pumping this year instead of the first quarter of 2020.
“I haven’t heard any change from the first quarter. There was no particular date in the first quarter. But I’m hearing now that first quarter may be an outside date. I’m not sure whether we’ll be able to get it this year or not. Signs are encouraging though”.
Meanwhile, Bynoe, during his address to attendees at the reception, noted that the Liza Destiny’s arrival ahead of schedule means that the Department of Energy’s own timetable has to be fast tracked.
“The Liza Destiny’s arrival three weeks ahead of the schedule means that our timetable has moved forward. And as a policy-related body, the Department of Energy is also called upon to advance its timetable”.
“It means that we move earlier to production of first oil and to seeing the benefit of this industry impact Guyanese much faster. As Guyanese, we must realise that it is a vessel paid for by Guyanese, pumping Guyanese fuel, which will bring in revenue for Guyana”.
Following its 10th discovery of oil in the Stabroek Block, ExxonMobil had estimated the recoverable resource in the block to be 5 billion oil-equivalent barrels. With oil at over US$50 a barrel, that equates to well over US$200 billion.
Exxon has since revised this figure upwards after three more discoveries, the last one being at the Yellowtail-1 well in April. More drilling is also scheduled for this year and it was only days ago that its first FPSO bound for Guyana, the Liza Destiny, was commissioned.
ExxonMobil has also said there is potential for at least five FPSO vessels on the Stabroek Block, producing more than 750,000 barrels of oil per day by 2025.
The start-up of the Liza Phase 1 development has always been on track to begin by the first quarter of 2020. However, there has been talk previously of the possibility of production starting even earlier.
Exxon has pegged oil production at 120,000 barrels of oil per day utilising the Liza Destiny FPSO. Liza Phase 2 is expected to start up by mid-2022, after Exxon made a final investment decision after getting regulatory approval earlier this year. It had been reported that the project would use the Liza Unity FPSO to produce up to 220,000 barrels per day.
ExxonMobil affiliate, Esso Exploration and Production Guyana Limited, is operator of, and holds 45 per cent interest in, the Stabroek Block. Hess Guyana Exploration Ltd holds 30 per cent interest, and CNOOC Petroleum Guyana Limited, a wholly-owned subsidiary of CNOOC Limited, holds 25 per cent interest.
The Liza Destiny, Guyana’s first oil production vessel, arrived in Guyana’s waters at the end of last month after travelling nearly 11,000 nautical miles for 42 days from the Keppel Shipyard in Singapore.
The vessel is a significant component of the Liza Phase 1 development, which involves four undersea drill centres with 17 production wells. Besides its production capacity of 120,000 barrels of oil per day, it also has an overall storage volume of 1.6 million barrels. During normal operations, there will be at least 80 persons living and working on-board the vessel.
Before its departure from the Keppel Shipyard in Singapore, the Liza Destiny was commissioned by First Lady Sandra Granger. The Liza Destiny FPSO was converted from oil tanker, “Tina”, a 1999 Very Large Crude Carrier (VLCC). The conversion included upgrading of the hull and integration of 14 topside processing modules, totalling 16 thousand metric tonnes.