Draft Payara licence being discussed

APPROVAL of ExxonMobil’s Payara Development Project seems closer to fruition, as Minister of Natural Resources Vickram Bharrat has confirmed that a draft licence is being discussed.

The project, located in the eastern half of the Stabroek Block, is expected to see the drilling of up to 45 development wells which could take up to five years, with drilling initially pegged to begin in 2020 and initial production by early 2023.

The project marks EEPGL’s third field development in the Stabroek block and targets 180,000 to 220,000 barrels of oil per day, with anticipation to produce approximately 5,700,000 to 6,600,000 barrels of crude oil per month.

A review of the Payara Development Project was previously conducted by the Bayphase Oil and Gas Consultants contracted by the Department of Energy (DoE) under the previous administration.

The new People’s Progressive Party/Civic (PPP/C) administration, however, decided to review the work already undertaken by the DoE to ensure that the interests of all Guyanese are protected and are in keeping with international transparency and accountability standards. The current review is being done by a team of international experts, headed by Canadian Queen’s Counsel Alison Redford.

When contacted about the ongoing review, Minister Bharrat told this publication that a team of legal and technical experts from the DoE and a team from ExxonMobil are discussing the draft licence for the Payara project.

“There are still issues to be worked out, but the teams will be meeting over the next few days,” said the minister, adding: “We need to get this right, so that when the final agreement goes to the President, he is satisfied.”

President of ExxonMobil Guyana Alistair Routledge, in commenting on the review of the project, had said objectives align on matters such as the importance of protecting the environment, and ensuring that all Guyanese benefit from their resources. However, the oil and gas company is aware that the clock is ticking.

According to a recent report, Routledge said that already, there has been some delay in the Payara project, but meeting a September 2020 timeframe for approval could prevent future development projects from being delayed.

“If we can achieve the full funding, all the approvals necessary for Payara in the month of September, in the next few days, weeks, then we can keep those other projects on course. If we see a delay, unfortunately, it’s not just a day-to-day delay. If we delay beyond September, then it would be a multi-month, maybe nine to 12 months delay, because of the installation windows that we have offshore with weather systems,” the ExxonMobil Guyana President said.
Guyana has already received US$140 million from the sale of crude, which is being produced by EEPGL’s Liza phase 1 development.

ExxonMobil is now firmly established in Guyana, operating an office in Georgetown with numerous ongoing exploration and development operations offshore. ExxonMobil Guyana has made 16 discoveries since May 2015 and began production in December 2019 from the Liza Phase 1 development project.

The company is the operator of the Stabroek, Canje and Kaieteur Blocks offshore Guyana. Since 2015, ExxonMobil has increased its estimated recoverable resource base in Guyana to more than 8 billion oil-equivalent barrels.