-as Guyana approaches 13 billion barrels of oil equivalent
WITHIN the coming months, the Guyana basin is poised to witness its largest exploration campaign ever, as ExxonMobil and its partners prepare to begin the drilling of multiple wells across several blocks offshore Guyana.
According to a publication by OilNow, ExxonMobil, via its local affiliate Esso Exploration and Production Guyana Limited (EEPGL), has already submitted a document outlining its plans to the Environmental Protection Agency (EPA). In the submission, the company said that Guyana’s oil reserves could more than double its confirmed nine billion plus barrels of oil equivalent, once drilling commences in the Stabroek and Canje blocks. These heightened exploration efforts are expected to run until December 2025. The oil company said that it plans to drill a total of 37 wells at the Stabroek block alone.
With regard to drilling capacity, Exxon said that it will continue use of its six drill ships, namely the Stena Carron, the Stena DrillMAX, the Noble Bob Douglas, the Noble Tom Madden, the Noble Don Taylor and the Noble Sam Croft, all of which continue to operate offshore Guyana. As it is, these vessels have been executing a series of exploration, appraisal and development drilling campaigns with the Stena Carron being the only rig equipped to perform well tests.
OilNow related that while the proposed drill programme outlined in the document submitted to the EPA focuses heavily on the development of the Stabroek and Canje Blocks, there was no mention of Kaieteur block which has since seen a non-commercial discovery at Tanager.
In August, however, it was announced that the date for elective nomination of the second drill target on the Kaieteur block would be extended by seven months to March 22, 2022.
“The Kaieteur block partners agreed to this extension to facilitate continuing analysis by Exxon, and integration of extensive multi-play drilling results and comprehensive data collection programmes into regional petroleum system models and the prospect nomination decision,” OilNow reported.
It is said that exploration across this particular acreage can also potentially add new volumes to the growing estimated recoverable resources offshore Guyana. A report compiled by Netherland, Sewell and Associates Inc. had indicated the aggregate ‘best estimate’ gross unrisked prospective resources for nine prospects in the southern part of the Kaieteur Block is 2.1 billion barrels of oil.
Meanwhile, as it relates to drilling in the Corentyne block, CGX Energy has already commenced drilling for oil at its Kawa-1 well, presumably one of the “most exciting” exploration wells in the world, according to its operators.
The Kawa-1 well is located in the north-east quadrant of the Corentyne Block, approximately 200km offshore Georgetown. The water-depth is approximately 355 metres (1,174 ft), and the expected total depth of the Kawa-1 well is 6,575 metres (21,700 ft). It was reported recently that the estimated cost for the Kawa-1 project is close to US$85 million. The well is expected to reach total depth in the first half of December 2021.
Nonetheless, earlier in August, Minister of Natural Resources, Vickram Bharrat, told the attendees of an Offshore Technology Conference that oil discoveries in the Guyana Basin have been quite lucrative with Guyana currently approaching 13 billion barrels of oil equivalent resources, which could see mammoth increases as more drilling begins.
Bharrat had cautioned, too, that even though the majority of Guyana’s oil discoveries were made in the Stabroek block, Guyana’s petroleum potential is far more expansive and goes beyond the ExxonMobil-operated areas. Since 2015, Guyana has had 22 oil discoveries, and with the country poised to gain far more within the coming years, Bharrat assured that his government’s approach is to “bring benefits from the sector to our people.”
As a matter of fact, he told residents during a recent Cabinet outreach to Region Two, Pomeroon-Supenaam, that the People’s Progressive Party Civic will not be making the mistake of falling prey to the Dutch disease, and will therefore ensure that the oil revenues are invested and spent on accelerating growth in a number of key non-oil sectors such as agriculture, health and the provision of improved social services.
He assured that currently, the more than US$400 million contained in Guyana’s Natural Resources Fund remains untouched, and will only be spent once the requisite legislation is in place to ensure intense scrutiny and accountability of how the monies are spent. “Any spending from that fund must get parliamentary approval,” Bharrat assured.
EXTRACTING IN A HURRY
Also speaking at the aforementioned Offshore Technology Conference (OTC), Vice-President Dr. Bharrat Jagdeo had recognised that because of the climate change imperative to decarbonise the world, it was important that Guyana pursues an aggressive mission of “getting as much oil out of the ground as quickly as possible.”
The former President reasoned that Guyana has to maximise the benefit from the industry and use those benefits to change lives of every Guyanese. “We don’t know how swiftly we’ll get to a decarbonised world, but we have to make use of this period when there is still demand to get as much as possible out of the ground and that is why we support the rapid pace of the industry, but it must be done safely,” he posited.
On a local radio programme called, ‘Guyana’s oil and you’, Jagdeo had said, pointedly, that even with the environmental concerns relating to oil production, Guyana does not have the option of leaving the oil in the ground. “There are many people saying now that we should not be producing oil. We don’t have that option in Guyana. Our people badly need development and we have to make sure that we produce the oil and get as much development out of it for our people to invest long term in other sectors so that they can get wealthier and have a decent life.”
The former Head of State, who has been globally recognised for his efforts to fight against climate change, indicated his government’s intention to rely on the advice of experts to ensure that its decision to continue oil production was sound.
“We can’t shut down the industry as some people have been calling for. We are going to be driven by the technical expertise. The oil and gas industry will be vital to our future and we have to do it well,” he said. “We have made it clear that we are going to try, as far as possible, to ensure that Guyanese benefit from these resources,” he reiterated.
A similar situation exists in Suriname. It is for this reason that the two countries have decided to collaborate on a joint strategy, ahead of its participation of the United Nations’ Climate Change Conference, also known as COP26. To facilitate the creation of this joint strategy, Vice President Jagdeo and minister Bharrat are currently on an official three-day working visit to neighbouring Suriname.
It was only on Tuesday that the two countries hosted a ‘Technical Meeting on Climate Cooperation between the Republic of Suriname and the Cooperative Republic of Guyana’, which saw Dr. Jagdeo and Minister Bharrat leading the dialogue from Guyana’s end. The forum also saw the participation of Keith George, Guyana’s Ambassador to Suriname, while the Suriname delegation comprised of Ambassador Albert Ramdin, Minister of Foreign Affairs, International Business and International Cooperation; Silvano Tjong-Ahin, Minister of Spatial Planning & Environment and David Abiamofo, Suriname’s Minister of Natural Resources. (By Rehana Ahamad).