Traditionally, analysts often assess oil resources based on generalities or broad assumptions. However, consultancy group Wood Mackenzie says when trying to understand where to get more oil, precision is key.
The upstream industry remains active and must fill the 450 billion barrels equivalent (boe) of undeveloped supply needed by 2040. Today, there is no resource shortage overall, but the supply opportunity is overshadowed because the industry has a lot more supply than demand, WoodMac said. This means only the best oil – the most advantaged resources – makes it to the market.
In the case of WoodMac’s analysis, understanding what attributes impact oil recovery factors helped answer their pointed question, ‘Which countries have the best performing deepwater reservoirs?’
“We found that 80% of the remaining deepwater oil resources will come from five countries (Brazil, US, Gulf of Mexico, Guyana, Nigeria, and Angola), therefore, understanding the quality of their reservoirs is key to identifying who has the best oil,” said Dr. Andrew Latham, Vice-President Subsurface Research for Wood Mackenzie.
The deepwater reservoirs in Guyana’s Stabroek block where more than 9 billion barrels of oil have been found rank among the best in the world for quality and are expected to deliver high productivity.
“The reservoirs rank among the highest quality in the world with high porosity and permeability that are expected to deliver very high recovery factors and production rates,” says John Hess, CEO of Hess Corporation.
With every new discovery off the coast of Guyana, analysts have been ramping up their projections for output, making it clear that the new oil producing nation is on course to become one of Latin America’s top producers, potentially second only to Brazil.
“It’s one of the major petroleum provinces in the world,” Hess said. “The first three ships that we authorized have a break even between $25 Brent and $35 Brent. We see multi-billion barrels of exploration potential there.”