Final investment decision on gas-to-energy project imminent – Exxon executive

…says project part of company’s sustainable development commitment to Guyana

A Final Investment Decision (FID) by ExxonMobil on the gas-to-energy project, which it is investing over US$1 billion in to build out the pipeline and assorted infrastructure, is imminent. This is according to ExxonMobil Upstream Company President, Liam Mallon.
Mallon gave this update during an interview with OilNOW. In the interview, he was asked when the company is likely to make its FID for the project. Mallon noted that the work towards making that decision is ongoing.
“I think it’s imminent. The work is ongoing. There are some necessities to complete, before the actual final investment decision. And we’re on track to achieve that very soon,” Mallon explained.
Mallon also emphasised the company’s belief in this project, noting that ExxonMobil has over the years pursued its oil exploration campaign with lowered emissions, also a focal point of its operations.
“We’ve been investing while others were pulling back, which has been essential as we’ve gone through the crisis we’ve seen in recent years. And doing so with lowered emissions. Continually, year on year. And have made very strong statements about 2030 and 2050, in that regard across our company,” the executive said.
“And fundamental to all of that, it’s part of our value system, is sustainable development in the countries we operate. And having been involved in Guyana from the very start, one of the key commitments that we made, is that we’re going to develop our business in this country in a way that provides sustainable benefits to people of Guyana. And a pillar of that is gas-to energy.”
While preparatory work has already started for the gas-to-energy project, the oil giant has not yet made a FID on the project. The delay is related to the Government review of the revised Lisa Field Development Plan (FDP), which has had to be updated so it can cater for the gas-to-energy project and the necessary infrastructure.
The scope of Guyana’s gas-to-energy project consists of the construction of 225 kilometres of pipeline from the Liza field in the Stabroek Block offshore Guyana, where Exxon and its partners are currently producing oil.
It features approximately 200 kilometres of a subsea pipeline offshore that will run from Liza Destiny and Liza Unity floating production, storage and offloading (FPSO) vessels in the Stabroek Block to the shore. Upon landing on the West Coast Demerara (WCD) shore, the pipeline would continue for approximately 25 kilometres to a Natural Gas Liquid (NGL) plant at Wales, West Bank Demerara.
The pipeline would be 12 inches wide, and is expected to transport per day some 50 million standard cubic feet (mscfpd) of dry gas to the NGL plant, but it has the capacity to push as much as 120 mscfpd. The pipeline’s route onshore would follow the same path as the fibre optic cables, and will terminate at Hermitage, part of the Wales Development Zone (WDZ).
In Budget 2023, the gas-to-energy project received a $43.3 billion allocation. This allocation is in addition to the $24.6 billion injected into the start-up of the transformational project, which also includes the construction of a 300-megawatt (MW) Combined Cycle Power Plant at Wales, WBD.
The NGL and 300 MW power plant components of the gas-to-shore project, are expected to cost US$759.8 million and will be financed through sources that include budgets and loan financing.
A sum of US$55 million per annum will be paid to ExxonMobil in amortisation costs for the pipelines to be installed in the gas-to-energy project, which will allow Guyana to in turn save and earn ten times that amount.
Guyana, with estimated recoverable natural gas reserves of over 17 trillion standard cubic feet, is likely to have the capacity to export as much as 50 million standard cubic feet of gas per day at some point in the future.
For perspective, this would make Guyana second only to Venezuela in the Region when it comes to estimated gas reserves. And Guyana is planning to make full use of its gas, formulating a gas utilisation plan as it continues work on the transformative gas-to-energy project. (G3)