The Stabroek Block, one of three large oil blocks operated offshore by ExxonMobil, is so large that it is 1,150 times the size of a Gulf of Mexico oil block. This is what was said by President and Chief Operating Officer at Hess Corporation, Gregory Hill during the company’s 2020 third quarter earnings call. Hess and Exxon are co-venturers in the block, along with CNOOC Nexxen.
Hess recently took the decision to sell out its interest in a producing Gulf of Mexico oilfield to raise money to plug into the upcoming Liza Phase Two project in the Guyana Stabroek Block.
Hill sought during the earnings call to explain the uniqueness of the Stabroek block, by pointing to its size and scale. The Stabroek Block is 6.6 million acres. It stretches from the border with Venezuela all the way to the Suriname border.
According to the US Bureau of Safety and Environmental Enforcement, a regulator in the Gulf of Mexico, typical blocks there are 5,000 to 5,760 acres.
Guyana’s Petroleum Act and Regulations allow the subject Minister to grant a licence “in respect of not more than sixty blocks” – about 5,073 sq. km or 1.25 million acres.
However, Section 13 of the Regulations states “The Minister may consider any application in respect of more than sixty (60) blocks where the Minister is satisfied that special circumstances exist for doing so.”
The award was first made by former President and Minister of Petroleum, Janet Jagan in 1999, then former Minister of Natural Resources, Raphael Trotman in 2016. Kaieteur News understands that a portion of Stabroek Block was relinquished under the 1999 agreement, including parts of what is now the Canje Block.
When pressed about the legality of his decision to allot more blocks than the legal limit, Trotman had said that the large acreage grant was above board, and that it was vital to protecting Guyana’s border security, seeing that Venezuela especially has been clamoring for ownership of the Essequibo region.
Exxon also operates two other blocks which, when initially granted, were both above the legal limit – Canje and Kaieteur block.
The Canje Block was awarded to Mid-Atlantic Oil & Gas on March 4, 2015 at 6,100 sq. km or about 1.5 million acres. Exxon later farmed in and is now the operator with a 35 percent stake. In the latter half of 2019, Exxon relinquished 20 percent of the Canje block, as per the relinquishment clause in the licence.
The Kaieteur Block was awarded to Ratio Guyana and Ratio Energy on April 28, 2015 at 13,500 sq. km or 3.3 million acres. ExxonMobil farmed in to 50 percent of the block, later selling 15 percent to Hess. Exxon is now the operator of that block as well, with a 35 percent stake.