Hess Corporation said on April 26 that the Kokwari-1 exploration well in the Stabroek Block offshore Guyana did not encounter commercial quantities of hydrocarbons.
Hess’ Chief Operating Officer (COO), Greg Hill noted that Kokwari was a higher-risk carbonate play that was located 37 miles from Liza-1. While it did not encounter commercial hydrocarbons, Hill said it did provide the partners with valuable data that further improves its understanding of the Stabroek Block sub-surface.
Going forward, Hill said the partners continue to see multi-billion barrels of upside that has not changed. He also stressed that, of the 11 billion barrels unlocked thus far, the majority is in the upper campaign.
“Obviously, with our exploration programme this year, we’re really starting to understand the deep and what potential that holds. But across the block, this multi-billion barrels of additional upside remains unchanged. Yes, we’ll have a few dry holes as we test different things along the way, but there’s still a lot more to play with,” Hill said.
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Despite having hit a non-commercial prospect, Chief Executive Officer (CEO), John Hess thought it prudent to remind shareholders of the bigger picture which is that the ExxonMobil-led team currently has line of sight to six floating production, storage and offloading vessels (FPSOs), in 2027 with a gross production capacity of more than 1.2 million barrels of oil per day.
Hess noted too that the company’s first four sanctioned oil developments on the Stabroek Block have a breakeven Brent oil price of between approximately US$25 and US$35 per barrel.
By 2027, the CEO said his company forecasts that its cash unit costs will decline by 25% to approximately US$10 per barrel of oil equivalent (BOE) adding that its portfolio will achieve a breakeven Brent oil price of approximately US$50 per barrel.
In terms of cash flow growth, Hess stressed that his company remains in the top percentile of firms with an industry-leading rate of change story and an industry-leading duration story, providing a highly differentiated value proposition.
