US oil giant ExxonMobil has made its ninth discovery offshore Guyana, marking its fifth discovery on the Stabroek Block in the past year and proving a new play concept for potential development.
The discovery was made at the Hammerhead-1 well, where approximately 197 feet of high-quality, oil-bearing sandstone reservoir were encountered.
The well was safely drilled to 13,862 feet depth in 3,373 feet of water.
The Stena Carron drillship began drilling on July 27, 2018.
President of ExxonMobil Exploration Company, Steve Greenlee, said the Hammerhead-1 discovery reinforces the potential of the Guyana Basin, where ExxonMobil is already maximizing value for all stakeholders.
Greenlee said the development options for Hammerhead will take into account ongoing evaluation of reservoir data, including a well test.
Hammerhead-1 is located approximately 13 miles southwest of the Liza-1 well, and follows previous discoveries on the Stabroek Block at Liza, Liza Deep,
President of ExxonMobil Exploration Company, Steve Greenlee
Payara, Snoek, Turbot, Ranger, Pacora and Longtail.
Those previous discoveries had led to the announcement of an estimated recoverable resource of more than 4 billion oil-equivalent barrels discovered to date.
It also creates the potential for up to five floating production, storage and offloading (FPSO) vessels producing more than 750,000 barrels per day by 2025.
ExxonMobil has said there is potential for additional production from significant undrilled targets, and there are plans for rapid exploration and appraisal drilling.
A second exploration vessel, the Noble Tom Madden, is due to arrive in Guyana in October to accelerate exploration of high potential opportunities, and will commence drilling at the Pluma prospect.
Liza Phase 1, which is expected to begin producing oil by early 2020, will use the Liza Destiny FPSO vessel to produce up to 120,000 barrels of oil per day. Construction of the FPSO and subsea equipment is well advanced.
Pending Government and regulatory approvals, Phase 2 is targeted for sanctioning by the end of 2018. It will use a second FPSO designed to produce up to 220,000 barrels per day, and is expected to be producing in 2022.
A third development, Payara, will target sanctioning in 2019 and use an FPSO designed to produce approximately 180,000 barrels of oil per day as early as 2023.
In May 2015, Exxon confirmed its significant oil discovery at its Liza 1 exploration well, where more than 295 feet of high-quality oil-bearing sandstone reservoirs were encountered.
Exxon’s oil find in Guyana has attracted international attention, with a number of seminars being held over time.
Drilling of Payara began on November 12, 2016, with initial total depth reached on December 2, 2016. In January of 2017, the oil giant had announced it had struck oil in its Payara-1 well, targeting the same type of reservoirs as the well’s Liza counterpart.
Before that, the company had announced that it had made its third significant discovery in its drilling explorations offshore Guyana. Its partner, Hess Corporation, had noted that the Liza 3 exploratory well’s net value could be US$6.2 billion based on calculations from the Bank of Montreal (BMO) Capital Markets.
In late June 2016, Exxon’s drilling results at Liza 2 revealed more than 58 metres of oil-bearing sandstone reservoirs in Upper Cretaceous formations. The well was drilled to 5475 metres at 1692 metres water depth.
Drilling results confirmed recoverable resources to be between 800 million and 1.4 billion barrels of oil equivalent. Data from the Liza 2 well test is being assessed.
Work has been ongoing to build Guyana’s institutions and systems, although Government has faced criticism for the pace of this progress.
In addition, assistance is being provided by the IMF to boost Guyana’s administrative capacity to handle the expected inflow of revenue.
ExxonMobil’s affiliate, Esso Exploration and Production Guyana Limited, is operator, and holds 45 percent interest in the Stabroek Block.
