Home Top Stories Exxon’s Chinese partner CNOOC raising US$5.1B for projects in Stabroek Block
…to issue up to 2.6B shares on stock exchange
Chinese State-owned company CNOOC Limited, which is a partner in the Stabroek Block, says it plans to raise $35 billion yuan (US$5.41 billion) for oil exploration and production offshore Guyana
According to a report in the Wall Street Journal, the Chinese company plans to issue shares on the Shanghai Stock Exchange that will go towards funding its oil and gas projects. It was reported that the company will issue no more than 2.6 billion shares.
The amount of shares that will be issued amounts to 5.82 per cent of the company’s share capital. Among the key projects the funds will finance is the Payara oilfield, which is oil giant ExxonMobil’s third development in the Stabroek Block.
The US$9 billion Payara development project, which was approved last year, has been hailed as the single largest investment ever made in the country. Payara will target an estimated resource base of about 600 million oil-equivalent barrels.
The project in the Stabroek Block is expected to produce up to 220,000 barrels of oil per day after startup in 2024, using the Prosperity Floating Production, Storage and Offloading (FPSO) vessel.
Payara is the third Field Development Plan (FDP) from Exxon to gain approval. The first FDP that the Guyana Government approved was for Liza Phase One, while Liza Phase Two is expected to start up in 2022.
A fourth project, Yellowtail, has been identified within the block with anticipated start-up in late 2025 pending Government approvals and project sanctioning. This project will develop the Yellowtail and Redtail fields, which are located about 19 miles (30 kilometres) southeast of the Liza developments.
The Prosperity FPSO vessel will be designed to produce 220,000 barrels of oil per day, will have associated gas treatment capacity of 400 million cubic feet per day and water injection capacity of 250,000 barrels per day. It was explained that the FPSO will be moored in water about 1900 metres deep and will be able to store around two million barrels of crude oil.
The construction of Prosperity’s hull started in January 2019. Prosperity will be Guyana’s third FPSO. It is expected to be deployed in ExxonMobil’s Stabroek Block offshore Guyana, as part of the Payara oil field development.
These new projects continue to drive investment in the Guyanese economy. More than 2300 Guyanese are now supporting project activities on and offshore, which reflects a morethan-20 per cent increase since the end of 2019. ExxonMobil and its key contractors have spent approximately US$388 million with more than 800 local companies since 2015.
ExxonMobil recently announced that it found 220 feet (67 metres) of high-quality oil in the Pinktail well offshore Guyana. It was explained that the Pinktail well, which was drilled by the Noble Sam Croft drill ship, is 21.7 miles southeast of the Liza Phase 1 project.
Additionally, Exxon was able to successfully appraise the Turbot-1 and 2 wells, where oil was previously found. In the case of the Turbot-2 well, drilling encountered 43 feet (13 metres) of net pay, separate from the oil previously encountered in the Turbot-1 well.
The Stabroek Block is 6.6 million acres (26,800 square kilometres). ExxonMobil is the operator and holds 45 per cent interest in the Block. Hess Guyana Exploration Ltd holds 30 per cent interest, and CNOOC Petroleum Guyana Limited, a wholly-owned subsidiary of CNOOC Limited, holds the remaining 25 per cent interest. (G3)