Kemol King and Sabrina Valle, Reuters

GEORGETOWN
EnergiesNet.com 05 01 2024

GEORGETOWN, April 30 (Reuters) – Exxon Mobil Corp

will shut down two offshore oil production projects in Guyana for two weeks each, between July and August, to connect a natural gas pipeline, the company’s country head Alistair Routledge told reporters in Georgetown on Tuesday.

The 140-mile (225-km) pipeline will feed Guyana’s $1.9 billion gas-to-power project aimed at ending the country’s dependence on imported fuels and at lowering energy costs for residents.

Exxon has said it will halt production to fulfill a commitment made with local authorities to have the pipeline connected by year end, despite delays on the government-run onshore part of the project.

The proposed pipeline would connect offshore production vessels to a power plant and a natural gas processing facility. The power plant and transmission lines will not be fully operational before end-2025, Guyana officials have previously said.

The offshore portion of the about $1 billion pipeline that is under construction by Exxon is 70% complete, Routledge said.

NO ESTIMATE ON RECOVERABLE RESERVES

At a press conference to update reporters on the company’s works, Routledge said the company stopped revising estimates for potential recoverable resources as it works to quantify actual reserves, an industry metric that considers how much of the oil and gas underground can be commercially developed.

Exxon has not updated in two years its estimates of 11 billion barrels in recoverable resources at the Stabroek block, despite a number of new oil discoveries.

Exxon has not disclosed a separate reserves number for the Stabroek block.

“Our greater focus now is on how do we move resource to reserves, because that’s what generates revenue for the country,” Routledge said.

The oil reserves estimates for Guyana are a key component to define how much of the Stabroek block would be worth on a potential sale.

The No. 2 U.S. oil producer, Chevron Corp (CVX.N), last October agreed to acquire Hess for about $53 billion in stock. But Exxon and CNOOC this year filed an arbitration case claiming they hold a right of first refusal over Hess’ Guyana assets.

That dispute is currently before the International Chamber of Commerce and is not expected to be resolved until late this year. None of the parties have disclosed how much they think the asset is worth.

Reporting by Kemol King in Georgetown and Sabrina Valle in Houston Editing by Emelia Sithole-Matarise and David Gregorio.

reuters.com 04 30 2024