Rystad Energy expects exploration activity in Guyana to rebound with an annual record of 16 wells.
Rystad Energy expects exploration activity in Guyana to rebound with an annual record of 16 wells.
Guyana’s exploration activity will be spearheaded by ExxonMobil as operator of the Stabroek and Canje blocks.
The company’s drilling activity will focus on firming up resources in the southeastern part of the Stabroek block, where the operator identified deeper plays underneath the existing discoveries and is now eyeing the unexplored northwestern parts of the block.
’Rystad Energy data suggests that close to 300 million barrels of oil equivalent has been discovered on average for each exploration well (wildcat and appraisal) drilled in the country over the past six years. With around 16 exploration wells planned, including some in riskier frontier regions, 2021 holds a lot of promise,’ said Santosh Kumar, analyst with Rystad Energy’s upstream team.
ExxonMobil’s fleet of drillships in Guyana is set to increase to six with the arrival of the Noble Sam Croft in April. Three drillships are currently operating in the greater Liza area. The recently arrived Stena DrillMAX has already started drilling activities on the Longtail-2 appraisal well, while the Stena Carron drillship, which recently concluded drilling Bulletwood-1, has now spud the Jabillo-1 exploration well in the Canje block.
The operator and its partners plan to deploy four floating production, storage and offloading units (FPSOs) to develop the existing resources within the block. However, the supermajor is expected to ramp up drilling activities, as it plans to have at least five FPSOs online by 2026. Success at this year’s Mako-2 and Uaru-2 wells on the Stabroek block could potentially firm up the Mako/Uaru area as a candidate for the next FPSO location. On the Canje block, plans are in place to drill two wells in 2021 in addition to the uncommercial Bulletwood-1 find, with the Jabillo well already in progress.
However, the year’s first completed well, Bulletwood-1 in the ExxonMobil-operated Canje block, encountered quality reservoirs but non-commercial hydrocarbons, according to Westmount Energy, which holds a stake in Canje partner JHI Associates. The well was targeting more than 500 million barrels of mean prospective resources in a prospect similar to Liza in the neighbouring Stabroek block.
Canada-based explorer CGX Energy operates the Demerara and Corentyne blocks with 66.67% interests, with Frontera Energy as its partner. The plan for 2021 consists of up to two exploration wells, at a combined estimated cost of about $90 million.
There are no drilling plans reported for this year as yet on the Repsol-operated Kanuku block and Tullow Oil’s Orinduik block. However, 3D seismic reprocessing is scheduled to mature prospects for future drilling.
Meanwhile, in eastern Guyanese waters there are only two unallocated blocks: Block C, which lies east of the Kaieteur block and north of Stabroek, and a smaller 1325 km2 block, which was relinquished by the Canje consortium.
The other unallocated offshore deepwater region lies northwest of Guyana’s offshore sector. This area, formerly called the Roraima block, is bordered by the Kaieteur and Stabroek blocks. It is, however, part of a territorial dispute between Guyana and Venezuela.
In the middle of this booming exploration activity, Guyana is considering a new bidding round in 2022. Drilling results will be eagerly watched by the services industry, as more exploration success off Guyana would translate into welcome opportunities after the market slump of 2020, said Rystad.
Meanwhile Rystad Energy has warned that extended vaccination campaign hiccups could put the recovery of up to 1 million barrels per day (bpd) of oil demand is at risk in 2021.
Rystad Energy currently forecasts global oil demand in 2021 at 95.2 million bpd, but under a slow vaccination scenario, oil demand in 2021 could only average 94.2 million bpd.
