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Thursday, November 26, 2020

Stabroek Block resources jump to 9 billion barrels of oil equivalent – Hess

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Hess Corporation, a 30 percent stakeholder at the Stabroek Block offshore Guyana, said on Wednesday that the estimated gross discovered recoverable resources have been updated to approximately 9 billion barrels of oil equivalent (boe) on the block.

In releasing its results for the third quarter of 2020, the company reported a net loss of $243 million, or $0.80 per common share, compared with a net loss of $212 million, or $0.70 per common share, in the third quarter of 2019.

“We continue to execute our strategy and achieve strong operational performance while prioritizing the preservation of cash, capability and the long-term value of our assets during this low-price environment,” CEO John Hess said. “Our differentiated portfolio of assets, including multiple phases of low-cost Guyana oil developments, positions us to deliver industry leading cash flow growth and drive our company’s breakeven price to under $40 per barrel Brent by mid-decade.”

Hess said its net production from the Liza Field, which commenced in December 2019, averaged 19,000 bopd in the third quarter of 2020. During the third quarter, ExxonMobil, operator at the Stabroek Block, continued work to complete the commissioning of the natural gas injection system that should enable the Liza Destiny floating production, storage and offloading vessel (FPSO) to reach its capacity of 120,000 gross bopd in the fourth quarter.

Hess said Phase 2 of the Liza Field development, which will utilize the Liza Unity FPSO with an expected capacity of 220,000 gross bopd, remains on target to achieve first oil by early 2022.

In reporting the sanctioning of the Payara Development, Hess said the project will utilize the Prosperity FPSO, which will have the capacity to produce up to 220,000 gross bopd and will target an estimated resource base of approximately 600 million barrels of oil. First oil is expected in 2024.

“Ten drill centers are planned with a total of 41 wells, including 20 production wells and 21 injection wells. Excluding pre-sanction costs and FPSO purchase cost, the Corporation’s net share of development costs is forecast to be approximately $1.8 billion,” the company said.

At the Stabroek Block, ExxonMobil announced discoveries at the Yellowtail-2 and Redtail-1 exploration wells. “Yellowtail-2, the 17th discovery on the Block, encountered approximately 69 feet of high-quality oil-bearing reservoirs adjacent to and below the Yellowtail-1 discovery,” Hess said. “Redtail-1, the 18th discovery on the Block, encountered approximately 232 feet of high-quality oil-bearing sandstone and is located 1.5 miles northwest of the Yellowtail discovery.”

Following the completion of appraisal work at the Yellowtail-2 well, the Stena Carron drillship began drilling the Tanager-1 well on the Kaieteur Block, located 46 miles northwest of Liza in August.

“Tanager-1 drilling operations are ongoing. The Noble Don Taylor drillship completed the drilling of the Redtail-1 well and is currently drilling and completing Liza Phase 2 development wells,” Hess said.

The other two drillships, the Noble Bob Douglas and the Noble Tom Madden, are drilling and completing Liza Phase 1 and Phase 2 development wells.

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