…Exxon says drilling, other operations not affected by Venezuela’s aggression

U.S. oil giant ExxonMobil said drilling and development operations offshore Guyana are unaffected by the recent interception of a seismic research vessel by Venezuela’s navy.

The interception took place last Saturday around 10:30hrs when the vessel, flagged by the Government of the Commonwealth of The Bahamas, was conducting seismic surveys on behalf of ExxonMobil in Guyana’s Exclusive Economic Zone (EEZ) and continental shelf.
In a statement on Boxing Day, ExxonMobil while not indicating when the research vessels will recommence operations, said that it’s drilling and development operations offshore Guyana have not been affected by the incident.

“Two vessels operated by Petroleum Geo-Services ceased conducting 3-D seismic data acquisition in the north-west portion of the Stabroek Block offshore Guyana when approached by the Venezuela navy,” ExxonMobil said. Subsequent to the incident, the

Venezuelan navy retreated from the area as well as the vessels.
It was noted that the area where the incident occurred is more than 110 kilometres from the Ranger discovery, the closest of 10 oil discoveries made by ExxonMobil in the south-east section of the Stabroek Block.

“Exploration and development drilling is continuing in the south-east area of the Stabroek Block. Activities related to the LizaPhase 1 development, which is expected to begin producing up to 120,000 barrels of oil per day in early 2020, are also unaffected,” the oil giant assured.

ExxonMobil operates the Stabroek Block offshore Guyana under licence from the Government of Guyana. The acquisition of seismic data was being conducted under licence from the Guyana Government in the country’s Exclusive Economic Zone.
“ExxonMobil estimates there is potential for at least five floating, production storage and offloading vessels (FPSO) on the Stabroek Block producing more than 750,000 barrels of oil per day by 2025.

“Liza Phase 2 is expected to start production by mid-2022. Pending government and regulatory approvals, project sanction is expected in the first quarter of 2019 and will use a second FPSO designed to produce up to 220,000 barrels per day,” it reported.

Sanctioning of a third development, Payara, is also expected in 2019, the oil company said, while noting that production is expected to start as early as 2023 at the well.

The Stabroek Block is 6.6 million acres (26,800 square kilometres). ExxonMobil affiliate Esso Exploration and Production Guyana Limited is operator and holds 45 per cent interest in the Stabroek Block. Hess Guyana Exploration Ltd. holds 30 per cent interest and CNOOC Nexen Petroleum Guyana Limited holds 25 per cent interest.

Venezuela has been heavily criticised as a result of the incident. In a recent statement, the Caribbean Community (CARICOM) called for Venezuela to respect Guyana’s sovereignty.
“Such acts violate the sovereign rights of Guyana under international law, its entitlement to a territorial sea, Exclusive Economic Zone and continental shelf, and pose a threat to Guyana’s economic development and national security,” CARICOM said.
Renewing its full support for the sovereignty and territorial integrity of Guyana, CARICOM said Guyana has the right to peacefully explore and exploit its onshore and offshore resources.

High Commissioner of the United Kingdom in Guyana, Greg Quinn, said “the UK is clear that the 1899 Arbitral Award settled the border between Guyana and Venezuela. We support the efforts of the UN Secretary-General.”

In the meantime, he said the rule of law must be respected and those who have legitimate permission to operate and undertake their activities must be allowed the do so, said Quinn.
On Sunday, the U.S. Government also called on Venezuela to respect international law and the sovereignty of its neighbours in the wake of the interception of research vessel the Ramform Tethys by Venezuela’s navy. In a tweet on Sunday, Deputy Spokesperson at the U.S. Department of State Robert Palladino said the U.S. Government is closely monitoring the situation. “We are monitoring reports that the Venezuelan navy may have interfered with vessels operating on behalf of ExxonMobil. We underscore that Guyana has the sovereign right to explore and exploit resources in its territorial waters and Exclusive Economic Zone,” Palladino said.

Guyana has dubbed the move illegal, aggressive and hostile, explaining that Venezuela’s action violates Guyana’s sovereignty and territorial integrity and demonstrates a real threat to the country’s economic development.

“The Ministry of Foreign Affairs will be bringing this latest act of illegality and blatant disrespect for Guyana’s sovereignty by Venezuela to the attention of the United Nations,” Foreign Affairs Minister Carl Greenidge said.

Greenidge had committed to formally write the United Nations (UN) and the governments of the 70 crew members whose safety was threated.