ExxonMobil makes ninth Guyana oil discovery

ExxonMobil contracted another exploration vessel to work its highly prospective play off Guyana where it has made a ninth discovery.

The drilling of the Hammerhead-1 well on the Stabroek block encountered around 197ft (60m) of high-quality, oil-bearing sandstone reservoir, the company said today.

The well was safely drilled to 13,862ft total depth in 3,373ft of water. The Stena Carron drillship began drilling Hammerhead-1 on 27 July.

"There is potential for additional production from significant undrilled targets," ExxonMobil said.

The incoming vessel, Noble Tom Madden, is scheduled to arrive in Guyana in October "to accelerate exploration of high potential opportunities and will commence drilling at the Pluma prospect."

The Noble Bob Douglas is conducting development drilling in the Liza project on Stabroek.

First oil from Phase 1 of Liza is expected in March 2020 at a rate of 120,000 b/d.

The company´s previous Guyana discoveries indicated estimated recoverable resource of more than 4bn bl of oil equivalent (boe) "and the potential for up to five floating production, storage and offloading (FPSO) vessels producing more than 750,000 b/d by 2025," ExxonMobil said.

ExxonMobil's string of successes in Guyana started in May 2015, when it discovered more than 1bn boe at its Liza-1 well on Stabroek.

ExxonMobil operates the 6.6mn acre (26,800km2) Stabroek with a 45pc stake. US independent Hess holds 30pc, and the remaining 25pc belongs to Chinese state-owned CNOOC unit Nexen.

Hammerhead-1 is located some 13mi (21km) southwest of Liza-1 and follows previous Stabroek discoveries Liza, Liza Deep, Payara, Snoek, Turbot, Ranger, Pacora and Longtail.

"The Hammerhead-1 discovery reinforces the potential of the Guyana basin, where ExxonMobil is already maximizing value for all stakeholders through rapid phased developments and accelerated exploration plans," said president of ExxonMobil Exploration Steve Greenlee.

"Development options for Hammerhead will take into account ongoing evaluation of reservoir data, including a well test."

Liza Phase 2 is targeted for sanctioning by the end of 2018, ExxonMobil said.

"It will use a second FPSO designed to produce up to 220,000 b/d and is expected to be producing in 2022. A third development, Payara, will target sanctioning in 2019 and use an FPSO designed to produce approximately 180,000 b/d as early as 2023."

Guyana's offshore acreage is part of the Guyana-Suriname basin that the US Geological Survey says contains an estimated 13.6bn bl of oil and 32 Tcf of natural gas.

Sparsely populated Guyana currently produces no hydrocarbons, and imports refined products from Trinidad and Tobago and the US to meet demand of about 12,800 b/d.

Local company GuyEnergy plans to build and operate a 30,000 b/d refinery to process some of the state's share of the crude.

ExxonMobil's success has attracted other companies to Guyana, including fellow US major Chevron, France´s Total, Spain´s Repsol, Italy's ENI and Germany's DEA.