Even as the global pandemic continues to cast a shadow on the oil and gas industry, its unprecedented effects have not eclipsed the attractiveness of Guyana’s world-class oil finds. In fact, it has served to highlight how advantaged the new producer’s reservoirs are. Highlighting this during his company’s third-quarter earnings call was Hess Corporation’s Chief Operating Officer (COO), Greg Hill.
The official was quick to note that one of the key characteristics of the Stabroek Block is its sheer scale and size. In this regard, he noted that the offshore concession is 6.6 million acres, which is equivalent in size to 1,150 Gulf of Mexico blocks. Hill was keen to remind participants that the Stabroek Block consortium which includes ExxonMobil and CNOOC has drilled 20 prospects and made 18 discoveries which contain approximately 9 billion barrels of recoverable oil and gas resources, with multiple prospects remaining.
Further to this, Hill noted that the Stabroek concession has first-class reservoir quality with exceptional permeability and porosity which have resulted in high flow rate wells and high recovery factors. Hill pointed out that the reservoirs are shallow and allow the partners to drill wells in a fraction of the time and the cost of other deepwater basins.
Additionally, the Chief Operating Officer stated that the block comes with a Production Sharing Contract that carries a competitive cost recovery mechanism, and with development occurring at the bottom of the offshore cost cycle.
Hill also noted that having ExxonMobil, ‘arguably the best project manager in the world’ for this type of development greatly reduces execution risk. He said too that having the first three developments (Liza 1, 2 and Payara) with breakeven prices of between US$25 and US$35 per barrel is also a major plus.
For all these reasons and more, the COO categorically stated that Guyana will create extraordinary long-term value for both shareholders and its citizens.