An ExxonMobil-led joint venture has recovered the billions of dollars it invested to develop a large oilfield in Guyana, its chief financial officer told Reuters, and the South American country will now receive more oil money.
Guyana’s Stabroek Block, estimated to hold at least 11 billion barrels of oil equivalent, has become one of the top assets of the U.S. oil producer’s portfolio since its discovery in 2015. Revenue from the field has made Guyana one of the fastest-growing economies in the world, with the country now producing more than 900,000 barrels per day.
The joint venture’s production sharing contract (PSC) with Guyana allowed Exxon and its partners to take up to 75 per cent of the oil to cover their exploration and development costs.
The accumulated $55 billion invested since 2014 has been recouped about two years faster than expected because of the rapid development of the block, Exxon Chief Financial Officer Neil Hansen said in an interview.
“We brought these investments on at an unprecedented pace and cost advantage,” Hansen said.
Under the PSC, the consortium splits profit oil evenly with Guyana after recovering costs. Exxon will now book about 100,000 fewer bpd from the country as it enters the third quarter, but free cash flow will increase by 2030 to twice the level seen in 2025, he said.
Exxon CEO Darren Woods said on Friday there is room for more exploration in Guyana and the company has used AI to evaluate drilling and subsurface data. A portion of the block remains under force majeure due to a maritime border controversy between Guyana and Venezuela, which awaits a ruling by a United Nations court.
“We’re not done yet in Guyana and we continue to see a really bright future there,” he said during the second-quarter earnings call.
Exxon operates the Stabroek Block with a 45 per cent interest. Chevron (CVX.N) holds a 30 per cent stake in the block after acquiring Hess Corp, the original partner in the consortium, and Chinese oil firm CNOOC (600938.SS) holds 25 per cent.
The consortium’s fifth and sixth projects in the Stabroek Block — Uaru and Whiptail — are expected to begin oil production this year and next year, respectively. (Reuters)
