The prolific Stabroek Block in Guyana is set to redefine the landscape of deepwater oil projects, marking a significant milestone in global energy production.
Vice President and Business Service Manager of ExxonMobil Guyana, Phillip Rietema, during an appearance on the Guyana Energy Perspectives Podcast published on June 30, underscored the monumental impact of these developments.
“The projects here in Guyana, you know, they compete internationally. They’re some of the best deep-water projects in the world. We’re very proud of them,” he said.
Echoing the same sentiments of Chairman and Chief Executive Officer of ExxonMobil Corporation, Darren Woods, Rietema added, “We expect that the Guyana projects that we are doing in Stabroek will go down as one of the greatest deepwater projects in the industry’s history. And that bodes well for Guyana and for all involved.”
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This bold assertion is backed by substantial achievements and investments. Exxon, alongside its partners Hess Guyana Exploration and CNOOC Petroleum Guyana, has poured $30 billion into the Stabroek Block, recovering $20 billion so far. With plans to invest an additional $55 billion, the consortium is firmly committed to long-term development in Guyana.
However, the significance of the Stabroek Block extends beyond Guyana’s borders. The rapid development and low breakeven costs of these projects are pivotal in an era where energy security and market stability are paramount.
Since the first discovery in 2015, Exxon’s ventures—Liza 1, Liza 2, and Payara—have accelerated production to over 600,000 barrels per day, making Guyana a key player in the global oil industry.
“It’s really that combination of a world-class asset, world-class revenues with this development cycle that it has on the small population. So, it really provides a unique opportunity for all of us at Exxon and in our industry, to have a really special impact on the country,” Rietema noted.
The low breakeven costs are particularly noteworthy. A report from the International Energy Forum (IEF) and S&P Commodity Insights revealed that Guyana’s average breakeven price of US$36 per barrel Brent stands out in the global market, with projects like Liza Phase 2 at US$25 per barrel and Payara at US$32 per barrel. These figures ensure that Guyana’s oil production remains competitive and profitable even amidst market fluctuations, a critical factor for North American stakeholders monitoring global oil prices. Moreover, the strategic investments in Guyana have been facilitated by agreements that deliver sizeable benefits to both the country and oil companies.
“About 52% of the profit is for Guyana and 48% for the contractor,” Rietema explained.
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The influx of revenues into Guyana’s Natural Resource Fund (NRF) underscores the economic impact of these projects. With a record US$330 million in inflows in 2023, the NRF is designed to manage the country’s resource wealth for the benefit of current and future generations, fostering sustainable growth and development.
ExxonMobil’s ongoing projects in the Stabroek Block, including the upcoming Yellowtail and Uaru developments, are set to further bolster production by 2026.
Rietema’s affirmed confidence that the Stabroek Block will be remembered as one of the greatest deepwater projects in history resonates strongly. According to him, the project’s success heralds a new era of energy production that promises stability, growth and shared prosperity on a global scale.
