Opposition Leader requests meeting with Exxon over troubled gas compressor

Opposition Leader Joseph Harmon has expressed concerns over the troubled gas compressor on the Liza Destiny floating production storage and offloading (FPSO) vessel offshore Guyana, and has requested a meeting with the local executives of United States oil giant, ExxonMobil, to be briefed on the matter.
After being sent all the way to Germany for repairs for several weeks and only returning recently, Exxon last week said the gas compressor on Liza Destiny has once again failed, resulting in oil production having to be reduced to 30,000 barrels of oil per day (bpd).
To this end, Harmon wrote President of ExxonMobil Guyana, Alistair Routledge, on Thursday last indicating that he is in receipt of numerous queries from the Opposition Members of Parliament, constituents of the APNU/AFC coalition, civil society and concerned citizens, who have expressed their worry that Exxon’s local affiliate Esso Exploration and Production Guyana Limited’s (EEPGL’s) performance, since inception, appears to be far below expectations.
This, he said in the letter that was released to the media on Sunday, is eroding the public’s confidence that the US oil major is engaged in a safe and environmentally sound operation.

“This reported lingering malfunctioning of equipment that continues to delay the termination of excess flaring of produced gas, plus the significant reduction of operations to a bare minimum production level, are of considerable concerns to the APNU+AFC Opposition, which as you are aware, represents almost half of the Guyanese population in the National Assembly,” the Opposition Leader posited.
As such, he added, “I, therefore, seek an urgent meeting with you and your executive team at the earliest mutually convenient opportunity to be briefed on matters to include this recent development, the root cause(s) of equipment failures resulting in excessive flaring and reduced production, your plan with schedule for permanently addressing these root cause(s), and the short and long term economic and environmental implications for all of Guyana.”
Harmon further asked to be accompanied by senior Members of Parliament including the Shadow Minister for Oil and Gas, David Patterson.
On Tuesday last, Exxon in a statement explained that as it was conducting the final testing phase of the reinstalled flash gas compressor and other components of the system on the <<<Liza Destiny>>> FPSO, they encountered an additional problem with the discharge silencer.
The US oil giant noted that a team from SBM Offshore, Germany manufacturer MAN Energy Solutions and ExxonMobil were on site to assess repairs, with support from engineering experts in Europe and the USA.
“We have reduced production to a minimum level that mitigates formation of hydrates in subsea systems, maintains gas injection and fuel gas to the power generators, and minimises flare,” the company said.
When asked, ExxonMobil Guyana’s Public and Governance Affairs Advisor, Janelle Persaud, revealed that this means the company is producing some 30,000 bpd – a reduction from an initial 120,000 bpd. This reduction, she noted, has the potential to throw off Exxon’s next lift, which was scheduled for the next few days.
“Relevant Government agencies have been notified and we are continuing to work with officials to determine the next best steps,” ExxonMobil stated.
The company also noted that it is “extremely disappointed by the design issues and continued underperformance of this unit”.
“This performance is below ExxonMobil’s global expectations for reliability,” it added.
ExxonMobil had previously announced that an “axial vibration” was to blame for the failure of its compressor.
When asked about the volume of flaring in light of the production cuts, Persaud had disclosed that flaring is now at 4 to 5 million cubic feet of gas per day, slightly above pilot levels.
Excess flaring had previously averaged at 16 million cubic feet of gas per day, following the compressor malfunction in February.
Meanwhile, the Guyana Government had subsequently expressed disappointment over the failure to resolve the issues with the gas compressor on its oil platform, which has not only led to heightened flaring but now a sharp drop in production as well. As such, it has hinted at possible actions against the oil company.
In a statement on Wednesday, the Ministry of Natural Resources said “The GoG is, as would be expected, highly disappointed with the Operator’s inability to resolve this situation to date and will continue to monitor the levels of daily crude oil output and flaring to best allow for an economically feasible level of production during this period. The GoG is currently examining the implications of the loss of output, and consequently loss of income and revenue, including measures that it may have to institute to protect national interest.”
Nevertheless, the Ministry noted that this occurrence has not affected GoG’s crude oil lift which was safely and successfully completed the day before at the planned quantity and in keeping with the Crude Lifting Agreement and Lifting Schedule. That was Government’s second lift for 2021.
Moreover, Exxon’s reduced production was announced the same day that Natural Resources Minister Vickram Bharrat was quoted projecting Guyana producing 1 million barrels of crude per day and leading the Western Hemisphere in oil production.
“By 2027, we are hoping that there will be at least seven floating production, storage and offloading (FPSO) vessels in the country, and that we will be producing either close or even over 1 million b/d,” Minister Bharrat had said.
In the meantime, Government through the Natural Resources Ministry, Guyana Geology and Mines Commission (GGMC), and the Environmental Protection Agency (EPA), has been receiving regular updates on the issue and is working with EEPGL to expeditiously resolve these complications with the compressor.