– Exxon has capacity to increase production in safe, sustainable way – CEO
Oil production on just the first two floating production, storage and offloading (FPSO) vessels, could reach as much as 400,000 barrels of oil per day (bpd), according to oil giant ExxonMobil following the release of its second-quarter earnings.
The two FPSOs have reached 400,000 bpd before, such as when it reached this benchmark in February 2023. However, permission had to be sought from regulators for this and this level of production was not maintained on a sustained basis afterwards.
According to the company’s Chief Executive Officer (CEO) and Chairman, Darren Woods, in a recent second-quarter earnings call, they were able to achieve a record gross production of 380,000 bpd from the Stabroek Block. He added, however, that there is scope for production from the Liza Destiny and Unity FPSOs to exceed 400,000.
“In Guyana, we achieved a record quarterly gross production rate of 380,000 barrels per day. Our team in Guyana continues to deliver excellent operating, environmental, and safety results while optimising and growing production.”
“In fact, we see the potential to increase the combined gross capacity of these two FPSOs to above 400 Kbd with further debottlenecking, which is nearly a 20% increase above the investment basis and a testament to the ingenuity of our people,” he said on the call, adding that when the Payara FPSO comes online it will further increase their capacity.
During the question-and-answer segment of the call, Woods was meanwhile asked about the company’s expectations of increasing its production on the two FPSOs. According to him, were this to happen it would be done in a safe and sustainable way without compromising the vessels’ designs.
“My expectation is, as I mentioned in my prepared remarks, (is) that we’re going to see the first two FPSOs get above 400,000 barrels of oil per day. Having a project organisation with the capability that we’ve built and strengthened here over the last several years, we end up with facilities that have the right design and are built the right way.”
“So that we’ve got a really good platform to optimise and find opportunities to maximise production, without compromising any of the design specifications and staying well within operating envelopes. We’ve done that over the years at a lot of our facilities,” the CEO said.
Exxon, through its local subsidiary Esso Exploration and Production Guyana Limited (EEPGL), is the operator of and holds 45 per cent interest in the Stabroek Block. Exxon’s remaining co-venture partners in the Stabroek Block are CNOOC Petroleum Guyana Limited, a wholly-owned subsidiary of Chinese company CNOOC Limited that holds a 25 per cent interest in the Exxon-administered Stabroek Block, and Hess Guyana Exploration Ltd, which holds 30 per cent interest.
It was only in April 2023 that the Prosperity FPSO, constructed by SBM Offshore, arrived in Guyana to join the other FPSOs – Liza Destiny and Liza Unity, which are currently producing more than 380,000 barrels per day.
Prosperity will develop the Payara field in the offshore Stabroek Block. It has an initial production capacity of around 220,000 barrels of oil per day and an overall storage volume of two million barrels.
Production from the Prosperity vessel is expected to push daily production to some 600,000 barrels a day in 2024. ExxonMobil had said at the time that installation campaigns were ongoing and development drilling is underway to support Prosperity’s start-up later this year.
ExxonMobil has said it anticipates at least six projects offshore Guyana will be online by 2027, with possibly 10 FPSOs operational by 2030. The third project – the Payara development – will target an estimated resource base of about 600 million oil-equivalent barrels and was at one point considered to be the largest single planned investment in the history of Guyana.
Meanwhile, the Yellowtail development, which will be oil giant ExxonMobil’s fourth development in Guyana’s waters, will turn out to be the single largest development so far in terms of barrels per day of oil, with a mammoth 250,000 bpd targeted.
