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Kaieteur News
GERORGETOWN
EnergiesNet.com 05 10 2022
According to the Petroleum Production Licence (PPL) for the US$10B Yellowtail Project, ExxonMobil’s affiliate, Esso Exploration and Production Guyana Limited (EEPGL) will be required to conduct a Gas Utilisation Study to examine the associated gas and non-associated gas available from all approved oil projects and discoveries in the Stabroek Block.
It therefore means that the government is seeking to ascertain how much gas is in the Liza Phase One, Liza Phase Two, Payara and the Yellowtail Projects. The administration also wants Exxon’s help in understanding the oil to gas ratio of all its discoveries in the Stabroek Block.
The 69-page PPL as seen by this newspaper, outlines that this study shall consider several issues over the short, medium and long term. They include a forecast of the potential gas production for export from the Yellowtail floating, production, storage and offloading (FPSO) vessel and the expected use that gas will be put to.
The study is also expected to consider scenarios for the demand for gas sales locally, regionally (the countries bordering Guyana), South America wide and internationally; and consider the cost and feasibility of gas export as Liquefied Natural Gas (LNG) and Liquefied Petroleum Gas (LPG).
Furthermore, EEPGL is required to examine the feasibility of utilising the existing and planned wells, flowlines, risers and production facilities for the export of gas both during and after the currently planned oil production phase. The licence also states that EEPGL must determine the feasibility and cost of adding gas export equipment, wells, well workovers, flowlines, metres, risers and pipelines for export gas not included in the original Field Development Plan (FDP) submission costs. Government also wants the potential gas export rates and profiles to be determined at minimum and maximum feasible rates verified by reservoir modelling.
Kaieteur News understands that within 60 days of the date of the licence being issued (April 1, 2022), the EEPGL is required to propose for approval by the Minister of Natural Resources, Vickram Bharrat, terms of reference, methodology and workplan (including the schedule of activities), for each study.
Within 270 days of the approval of the terms of reference, methodology and workplan (including the schedule of activities) or such later timeline as directed by the Minister so as to ensure EEPGL’s full compliance with this condition and support a diligent and transparent exercise, the company is expected to complete the study’s final report.
Furthermore, the PPL states that the Gas Utilisation Study is in addition to the requirement under the Petroleum Agreement Article 12 (b) which states that for each FDP that does not utilise all available associated gas for operations or to enhance oil production, to include an Excess Gas Feasibility study within five years of a Development Plan Submission.
The Licensee is therefore required if the Gas Utilisation Study determines that gas is available at Liza Phase 1 Liza Phase 2, Payara, Yellowtail or any other developments, to submit the individual gas feasibility studies as per the Petroleum Agreement Article 12 (b).
Importantly, that same Petroleum Agreement notes that all studies regarding the use of gas are part of recoverable costs. It therefore means that the citizenry ultimately pays for the studies being conducted by EEPGL.
kaieteurnewsonline.com 05 09 2022
