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Friday, March 5, 2021

Hess commits around US$1.8 billion for Payara development

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Hess Corporation, a 30 percent stakeholder in Guyana’s Stabroek Block, has committed around US$1.8 billion for the Payara development, representing its net share of development costs, excluding pre-sanction and FPSO purchase costs.

The company said on Wednesday it looks forward to forging ahead with the third development at the Stabroek Block and thanked the Guyana government for its support in moving the project forward.

“We are excited to sanction our third oil development on the Stabroek Block,” CEO John Hess said. “We thank the Government of Guyana for their support and look forward to realizing the full potential of this world class resource.”

Addressing the matter of costs, Hess said the timing of the FPSO purchase is being evaluated. SBM Offshore, the company contracted by ExxonMobil to build and operate the Prosperity FPSO, announced Thursday that contracts for the projects have been confirmed.

“Hess’ net share of development costs is forecast to be approximately US$250 million in 2021, US$450 million in 2022, US$500 million in 2023, US$300 million in 2024 and US$225 million in 2025,” Hess Corporation said.

The total cost of the Payara development is pegged at US$9 billion, representing the highest investment ever made in Guyana’s history.

Gross discovered recoverable resources for the Stabroek Block are estimated at more than 8 billion barrels of oil equivalent as of January 2020. The 18 discoveries on the block to date have established the potential for at least five FPSOs producing more than 750,000 barrels of oil per day by 2026.

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