Although already delayed since 2019, if the Payara development is approved by the end of September, this will ensure that the 2023 timeline for oil production start-up remains on track, adding another 220,000 barrels of oil per day to Guyana’s output.
Officials at Hess Corporation, a 30 percent stakeholder in the prolific Stabroek Block, say they remain optimistic that the new government in Guyana will approve the long-delayed project soon.
Speaking at the Barclays CEO Energy-Power Conference in New York on Wednesday, Greg Hill, President and Chief Operating Officer of Hess Corporation, said based on assurances from both the previous and current administration, the Stabroek consortium has been putting the necessary framework in place to immediately move forward once there is approval.
“… there are three open-water campaigns on Payara. It’s got a very extensive subsea architecture to it. So, you need three weather windows to get a lot of that work done,” he said, pointing out that approval in the coming weeks would put the project “fully back on track.”
The Payara development was initially expected to be sanctioned last year but encountered government approval challenges for several months and was further delayed due to an elections crisis in the South American country that lasted for five months this year. The new administration which took up office early last month, has been conducting a review of the work that was done by the previous government on the project, prior to approving.
“All the signs we’re getting from the government are very positive about getting that approval before the end of September,” said John Hess, CEO of Hess corporation, speaking at the same event. “And where we had talked before about Payara potentially having a six to twelve month delay, if we get that approval before the end of September, that delay will no longer hold and we’ll look at first oil coming out in 2023 as we originally said.”
Guyana’s Natural Resources Minister, Vickram Bharrat said this week the Payara development is part of a series of offshore activities that will help fuel the government’s long-term growth plans. Vice President, Dr. Bharrat Jagdeo has said while all efforts are being made to ensure government’s concerns are addressed before granting approval for the project, the intent is not to stall investments.
“There are numerous opportunities in this continuum. This is not a one-event activity where Payara will determine all of our relationship or determine all of our negotiating positions or opportunities,” Mr. Jagdeo stated.
Payara will follow the Liza Phase 1 and 2 developments at the ExxonMobil-operated Stabroek Block, where production is expected to surpass the one million barrels per day mark by the end of the decade, according to analysts.