(Bloomberg) — ExxonMobil has signed a deal to explore for oil and gas off the coast of Trinidad and Tobago, a decade after making the world’s largest discovery in a generation in nearby Guyana.
The Texas oil giant was awarded a 7,165 square kilometer block named TTUD-1 about 190 miles (306 kilometers) off the coast of the Caribbean nation on Tuesday. Exxon has agreed to acquire 3D seismic data over a portion of the block as part of the production sharing contract, Prime Minister Kamla Persad-Bissessar said. The “mandatory” first phase is expected to cost the company $42.5 million, she said.
Exxon’s projected spend could rise to more than $20 billion if the company finds oil or gas in the ultra deep water block, according to Trinidad and Tobago Energy Minister Roodal Moonilal.
The oil major discovered more than 11 billion barrels of crude in Guyana after drilling the first exploration well in 2015, at a time when many of its peers balked at the prospect.
“We’re going to bring Exxon Mobil’s leading technology capability directly from Guyana,” said John Ardill, Exxon’s vice president for exploration.
The aim is to make Trinidad and Tobago the “energy capital” of the Caribbean once again, Persad-Bissessar said. Her government would accelerate the “responsible” exploration of unexplored land and marine acreages, continuously improve acreage award processes and undertake a comprehensive review of the oil and gas taxation regime to ensure her country remains an internationally competitive hydrocarbon province.
To reduce risk, Trinidad and Tobago merged seven blocks into one during negotiations with Exxon. “Consolidation of the blocks removes risk in both exploration and development of the block,” the Energy Chamber of Trinidad and Tobago said.
