Canute James, Argus

GEORGETOWN
EnergiesNet.com 03 30 2022

Guyana has selected the acreage it will offer later this year when it changes how it selects international oil companies for production sharing contracts.

The government will seek interest in the 11,200km² Takutu basin which lies 480km inland near the border with Brazil, and which first attracted explorers 40 years ago, Guyana’s investment office said.

The other prospect is the 26,800 km² ultradeep Block C that is adjacent to the border with Suriname and beside the Canje and Kaieteur blocks contracted by US major ExxonMobil, the office said.

Exploration and production contracts granted so far have been on a non-competitive basis, with direct negotiations between the government and international oil companies. Guyana will change this system to the auctioning of blocks in the third quarter of this year, the government said. The natural resources ministry has not yet set a schedule for the auction of the blocks.

All the South American country’s oil has been produced from the ExxonMobil operated deepwater Stabroek block, but the country has “substantial acreage onshore and offshore that remains untapped,” the investment office said.

Several companies have drilled the Takutu basin since 1982, with some reporting indications of light crude. None of the wells proved commercial.

The government will determine whether companies with existing contracts — such as ExxonMobil that operates a total of three deepwater blocks — should be excluded from the tenders, Guyana’s vice president Bharrat Jagdeo said in November in announcing the change in awarding production contracts.

“We have to decide, however, whether we should do seismic surveys before auctioning as this would increase the value of the blocks, or just auction the blocks as they are,” Jagdeo said. “An alternative would be to vest all of these blocks into a national oil company.”

ExxonMobil started production of 32.1°API Liza crude from the Stabroek block in December 2019. Its partners include US independent Hess and Chinese state-owned CNOOC unit Nexen.

Current output is 120,000 b/d. Three other Stabroek projects planned by ExxonMobil will raise output to over 800,000 b/d by 2026, the company has said.

argusmedia.com 03 29 2022