(Argus, 21.Dec.2020) — ExxonMobil reached targeted crude production of 120,000 b/d at the Liza 1 well on Guyana’s deepwater Stabroek block, a milestone that had been delayed by an earlier re-injection glitch and equipment delays.
The target was achieved a year after start-up of the Liza Destiny floating production, storage and offloading (FPSO) vessel, with the company targeting full production of 32.1°API Liza crude in first quarter 2020.
“We are disappointed by the number of equipment issues experienced and that, because of these issues and Covid-19, commissioning of the gas injection system took longer than originally projected,” ExxonMobil Guyana president Alistair Routledge said.
In welcoming the output milestone, Guyana’s natural resources minister Vickram Bharrat did not refer to delays in the lifting of the country’s crude entitlement caused by the production delays. A fourth 1mn bl cargo had been scheduled to be lifted in mid-December. The natural resources ministry did not respond to a request for comment on a new lifting schedule.
In subsequent stages, ExxonMobil plans to expand Guyana offshore flows to 750,000 b/d in 2026.
Guyana’s oil production is rising against the backdrop of a new legal development in the country’s 120-year-old territorial dispute with neighboring Venezuela.
In an 18 December ruling, the International Court of Justice (ICJ) said it has jurisdiction to hear Guyana’s case seeking validation of its boundary with Venezuela.
The festering dispute is a legacy of British colonialism in Guyana. Caracas has long claimed sovereignty over the Essequibo region that makes up the western two thirds of Guyana, including oil-prone maritime territory.
Venezuela’s navy in 2013 seized a research vessel working in the Roraima block under contract from US independent Anadarko. The vessel and the crew were released after a week.
In December 2018, ExxonMobil suspended seismic surveys on a part of Stabroek after a research vessel it contracted was approached by a Venezuelan navy ship. ExxonMobil said the incident would not interrupt its long-term drilling and development operations.
The Hague-based ICJ’s announcement comes a month after the head of Guyana’s army said no foreign forces will again be allowed to “target” the country’s oil exploration and production operations.
“The court’s decision means international law can be brought to bear to ensure that Guyana’s patrimony is preserved,” President Irfaan Ali said.
The ruling was rejected by Venezuela’s foreign minister Jorge Arreaza who said the ICJ had no jurisdiction in a matter that should be discussed bilaterally with Guyana.
No schedule has been fixed by the court for the hearing of the substantive case.
By Canute James