Guyana’s fourth oil lift pushed to mid-December

EXXONMOBIL, in a bid to limit gas flaring offshore Guyana, has reduced production at its Liza Phase One development, shifting Guyana’s fourth oil lift to mid-December.

The country was anticipating its fourth lift later this month, but the decision taken by ExxonMobil will see Guyana receiving its ‘cut’ a few weeks late, said Minister of Natural Resources, Vickram Bharrat, in an invited comment on Sunday.

Guyana, new to the oil-and-gas sector, sold its first one million barrels of crude on February 19, 2020, raking in nearly US$55 million. In its second million-barrel sale, the country received US$35 million and US$46 million as proceeds from the sale of its third million-barrel of crude.
Along with these deposits and the US$4.9 million in royalties received from first-quarter gross production and interest, Guyana has over US$140 million in its Natural Resources Fund (NRF). The country had agreed to sell its first three cargoes to a trading arm of Shell on a dated ‘Brent’ basis. The oil market is volatile, but Brent price was listed as US$39.49 per barrel of oil on Sunday.

The country is entitled to five crude cargoes for this year, as part of its profit share with ExxonMobil and its Joint-Venture (JV) partners. This means that with Shell having received its three cargoes, the country can market its crude to another company or location.
A special evaluation team of local and foreign experts, appointed by the government, are examining tenders to ensure that Guyana has the best-suited company to market the country’s oil.

Even though a company is anticipated soon, the country, as mentioned, would have to wait a few extra weeks to receive its lift.
It was reported that ExxonMobil had taken a decision to limit oil production after encountering challenges with the gas handling system on the Liza Destiny Floating Production Storage and Offloading (FPSO) earlier this year. This had resulted in production hovering below the peak 120,000 barrels per day mark for several months.

“They could not push up production because it would be dangerous, so they did not achieve maximum production,” said Minister Bharrat.
The minister, in a past report, had said once everything is settled, the country should close the year with at least US$200 million in its NRF.
Vice-President, Bharrat Jagdeo had said no money from the fund will be used until Government amends or repeals the existing NRF Act.