ExxonMobil Guyana has indicated that it is withdrawing from the Kaieteur Block. Additionally, Ratio Petroleum Energy Limited has informed the market that Hess is also withdrawing from the block.
“ExxonMobil Guyana has exited the Kaieteur block offshore Guyana, with participating interest assigned to Ratio Guyana Limited and Cataleya Energy Limited; Ratio is anticipated to assume the role as operator,” Exxon stated in a press update on Thursday.
It noted that this withdrawal does not impact its exploration and development plans for Guyana.
Both Exxon and Hess will now seek government approval to reassign their participating interests in the deepwater concession, so that the remaining stakeholders, Ratio and Cataleya Energy Limited, may each retain a 50% participating interest.
Currently, Exxon (operator) holds a 35% working interest, Hess 20%, Cataleya 20% and Ratio 25%.
A missive on this latest development was issued by Westmount Energy, a UK firm which holds indirect interests in the block through shares in Ratio and Cataleya.
Westmount said Ratio Petroleum is seeking a farm-down of participating interests and operatorship. In this context, it is already in discussions with major oil companies with a view to bringing new entrant(s) to the block.
Notably, under the terms of the Kaieteur Petroleum Agreement, and upon submission of an application to enter the second extension period, the participating interests on the block will have until February 2025 to commit to drilling a second well. Westmount, in this regard, noted that Exxon would not be drilling that prospect.
ExxonMobil said its exploration efforts and discovery of oil in the Kaieteur Block have highlighted Guyana’s potential. Its singular exploration well drilled in the block, Tanager-1, had indicated the presence of 65.3 million barrels. However, the find was too small to be commercial as a standalone development.
The Kaieteur Petroleum Agreement is currently in the first extension period, which began on February 2, 2021 and lasts for three years.
Notably, Exxon affirmed that six floating production, storage and offloading (FPSO) vessels are still in the works for the South American nation. ExxonMobil still operates the highly successful Stabroek Block and the Canje Block offshore Guyana. At Stabroek, five FPSOs have already been sanctioned and will be producing simultaneously by 2026. The sixth, Whiptail, is in the application stage. An environmental impact assessment (EIA) was already submitted and is under review. A field development plan (FDP) is expected to be submitted to the Ministry of Natural Resources before the end of 2023.
At Stabroek, Exxon has a 45% stake, and is partnered with Hess (30%) and CNOOC (25%). At Canje, Exxon has a 35% stake, with TotalEnergies (35%), JHI Associates (17.5%) and Mid-Atlantic Oil & Gas (12.5%).