Natural Resources Minister Raphael Trotman is adamant that contrary to the prevailing criticisms that Government is being ill-advised and is, in fact, not adequately preparing Guyana for an oil and gas sector – the Government is watching and learning from other nations.
The Minister was at the time speaking during the opening of a geosciences technology workshop, organised by the American Association of Petroleum Geologists (AAPG), on Monday. According to Trotman, the Government is pursuing technical cooperation engagements like these, which can provide information with a nexus between the technical and the straightforward.
He acknowledged the importance of not only considering geological developments, but economic and commercial trends. Given the size of investment needed, Trotman said that understanding the geological occurrences in other oil-producing nations was especially important.
“Owing to the dynamic nature of the earth’s surface and the continental crust that we reside on, many structural changes have occurred that have allowed us to draw parallels with other onshore and offshore (oil) basins and to observe the successes and failures as we continue on this journey.”
He told the gathering at the Marriott Hotel that just recently a local team attended an oil producers’ conference in Trinidad, where the importance of learning from locations with similar geology and its role in successful exploration were greatly highlighted. “When there is a thorough understanding of geology and how it affects production, we can ensure optimal resource planning, efficient utilisation, and maximum recovery and successes.”
Trotman noted that Guyana would have the task of not only preparing legislative and institutional frameworks to efficiently manage the oil and gas sector in Guyana, but to also mentally prepare for the changes that petroleum production would bring. He was also adamant that Government remained committed to its green state development, alongside the oil sector.
There has been a flurry of activities in the Stabroek Block, since ExxonMobil’s 2015 oil find in Guyana. In May of that year, Exxon confirmed that more than 295 feet of high-quality oil-bearing sandstone reservoirs was encountered at its Liza 1 exploration well.
In late June 2016, Exxon’s drilling results at Liza 2 revealed more than 58 metres of oil-bearing sandstone reservoirs in Upper Cretaceous formations. The well was drilled to 5475 metres at 1692 metres water depth. Drilling results confirmed recoverable resources to be between 800 million and 1.4 billion barrels of oil equivalent. Data from the Liza 2 well test is being assessed.
The company had announced that it made its third significant discovery in its drilling explorations offshore Guyana. Its partner, Hess Corporation, had noted that the Liza 3 exploratory well’s net value could be US$6.2 billion based on calculations from the Bank of Montreal (BMO) Capital Markets.
Drilling on the Payara well began on November 12, 2016, with initial total depth reached on December 2, 2016. In January of this year, the oil giant had announced it had struck oil in its Payara-1 well, targeting the same type of reservoirs as the well’s Liza counterpart.
The Stabroek Block is 6.6 million acres. Esso Exploration and Production Guyana Limited (Exxon’s subsidiary) is the operator and holds a 45 per cent interest in the Block. Hess Guyana Exploration Ltd holds a 30 per cent interest, and CNOOC Nexen Petroleum Guyana Limited holds a 25 per cent interest.
The lesser-known Orinduik oil block has been under the administration of Eco Guyana and British company Tullow, after they signed a 10-year Petroleum Prospecting Licence and Production Sharing Agreement with Government last year.