Payara FPSO under construction without Govt approval

ExxonMobil continues to speed ahead with preparations for its intended Payara development in the Stabroek Block, despite no formal approval from government yet on the company’s third well. The construction of the Floating Production, Storage and Offloading (FPSO) vessel, called Prosperity is underway in Singapore.

SBM Offshore, the company Exxon tasked with building the vessel, did not make the announcement via official press release, but several credible media reports indicate that it received the hull in Singapore on Monday, August 31 from Chinese shipbuilder Shanghai Waigaoqiao Shipbuilding (SWS).
The FPSO hull is currently docked there, with work already progressing on the mooring system and preparation for the lifting and integration of the topside modules. In defiance of the government’s regulatory processes, Exxon had awarded an initial contract to SBM in November, 2019 for the Front End Engineering and Design (FEED). In that very month, ExxonMobil gave the Italian oilfield services company, Saipem a multi-million US dollar contract for the construction of a large subsea facility for the FPSO.

Exxon didn’t submit the Field Development Plan (FDP) for the project to Government until the following month. Guyana’s government hired the firm, Bayphase, to conduct the review of the Payara project shortly after.
Exxon intends for Payara to start producing oil in 2023, with the Prosperity FPSO at maximum capacity of 220,000 barrels per day, same as the Liza Unity FPSO for start-up in 2022. The Liza Destiny, currently in operation, maxes out at 120,000 barrels per day.

After months passed without approvals of the Payara project from the Energy Department and the Environmental Protection Agency (EPA), Exxon began to pressure Guyana for a swift approval, despite the fact that the country had not yet done its due diligence. It claims that if there is a delay beyond this month, Guyana would lose out on billions. Its country manager, Alistair Routledge even threatened last week that the company would take its money elsewhere if the government sought to renegotiate.

Head of the EPA, Dr. Vincent Adams had staunchly advocated for several issues in the Payara FDP to be fixed, before the Irfaan Ali administration sent him on leave. Exxon has flared billions of cubic feet of gas at the Liza Destiny and it wants the same loopholes it has exploited to do so present in the Payara permit. Similar issues exist where the dumping of thousands of gallons of produced water in the ocean is concerned. The water is supposed to be reinjected into the reservoir, but Exxon insists there is no hazard, even though no studies were done to determine the impact of the produced water on the environment.