Guyana’s oil producing capacity has just jumped to 900,000 barrels per day (bpd) after ExxonMobil launched production from Yellowtail, the fourth oil development in Guyana’s prolific offshore Stabroek block.
Exxon and partners have found more than 11 billion oil equivalent barrels in the Stabroek block, where production was already above 660,000 bpd before the start of production at Yellowtail.
By 2030, ExxonMobil expects to have total production capacity of 1.7 million oil equivalent barrels per day from eight developments offshore Guyana.
The ONE GUYANA floating production storage and offloading vessel at Yellowtail is the largest FPSO on the Stabroek block to date with an initial annual average production of 250,000 bopd and a storage capacity of two million barrels. Oil produced from the FPSO will be marketed as Golden Arrowhead crude.
The start of production at Yellowtail shows Exxon’s commitment to these advantaged barrels in the prolific Stabroek block.
The other U.S. supermajor, Chevron, now also has access to Guyana’s huge oil reserves after Chevron last month completed the acquisition of Hess Corporation, Exxon’s partner in the Stabroek block with a 30% interest.
Chevron’s deal was finalized after a more than a year-long arbitration battle initiated by Exxon, which challenged the Chevron-Hess deal, claiming it had a right of first refusal for Hess’s stake under the terms of a joint operating agreement (JOA) for the Stabroek block. Hess and Chevron claimed the JOA doesn’t apply to a case of a proposed full corporate merger.
Exxon is the operator of the Stabroek block with a 45% stake, and China’s state firm CNOOC has the remaining 25% stake.
Guyana’s offshore oil field is a top-performing asset with the potential to yield even more barrels and billions of U.S. dollars for the project’s partners. Both Chevron and Exxon will benefit from Stabroek even at relatively lower oil prices, because the Guyana block is estimated to have a breakeven oil price of about $30 per barrel.
By Tsvetana Paraskova for Oilprice.com
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