Coming on the heels of US oil giant ExxonMobil announces offshore drilling of its maiden well in the Canje Block, the Guyana Government envisages more similar exploration and production activities there.
That was linked by Natural Resources Minister Vickram Bharrat in a statement on Thursday.
On Tuesday, it was reported that Esso Exploration and Production Guyana Limited (EEPGL), a subsidiary of ExxonMobil, had begun drilling its first exploration well – Bulletwood-1 – in the Canje Block, marking the first feed to that block to search for oil.
Minister Bharrat said, “The Ministry of Natural Resources is pleased with these reports, and looks forward to further prospects for exploration and production in this area.”
Canje Block is located 180 km offshore Guyana in deep to deep waters with an area of approximately 4800 sq km. The operator of this block is ExxonMobil with 35 percent interest while Total also has 35 percent, JHI and 17.5 percent, and Mid-Atlantic Oil & Gas Inc., interest of 12.5 percent.
Bulletwood well-1 is the first well to be drilled in the Canje block and was interrupted by the Stena Carron drill that began drilling on December 31, 2020, at a water depth of 2846 m.
This well is said to be highly potent with an environment of disposal unique among the offshore Guyana blocks in that it includes a continental slope and basin floor land.
In fact, Bulletwood-1 is the hope of a Upper Cretaceous narrow-channel complex targeting around 500 million barrels of oil resources – similar to the lucrative Liza Field wells in the Stabroek Block that the US oil giant also operates .
The announcement of the Exxon dessert was made by investment firm Westmount Energy on Tuesday and followed recent notifications by the Department of Maritime Administration (MARAD) to boat operators about the offshore activities.
Westmount, itself holding shares in the Canje Block by owning a 7.2 percent indirect stake through Exxon’s partner, JHI Associates, also included comments attributed to its Chairman, Gerard Walsh.
According to Walsh, the campaign will evaluate deeper fund targets, with the potential to boost the value of Westmount’s shares.
“Bulletwood-1 is the first well in a fully funded, multi-well drilling operation being operated by ExxonMobil on the Canje Block over the next six months. This campaign will evaluate high-impact Cretaceous prospects in Liza’s proven playground with additional deeper fund targets, in some cases, ”said Walsh.
He added, “It also provides Westmount shareholders exposure to a portfolio of drilling results over a compressed schedule. Success from some of the wells in this portfolio could lead to transformative value changes for Westmount. ”
There has been talk of looting Bulletwood since last year. Apart from Bulletwood-1, there are known to be two other initial forecasts in the Canje Block – Jabillo and Sapote. Based on information previously put out by Westmount, the Canje Block could hold as much as 10 billion barrels of oil in total.
Guyana began oil production on December 20, 2019, in the Exxon-operated Stabroek Block that has more than eight billion barrels of crude, raising its first million barrels of profit oil from Liza-1 well in February 2020.
Cap Phillippe’s oil tanker transported this lift from Liza Destiny’s floating Production Storage and Unloading (FPSO) ship, allowing Guyana to receive its first payment next month.
That money, $ 11.4 billion, was Guyana’s first oil-based earnings from production at Liza Field. It was deposited in the Federal Reserve Bank of New York in March this year.
Subsequently, an additional $ 7.3 billion was deposited, plus royalty payments. However, this money has remained untouched, as the prolonged political crisis that followed the March 2nd General and Regional Elections damaged any attempt to establish a system for withdrawing funds.
The Natural Resources Fund Act states that various committees must be established to oversee the fund. It is expected that this legislation will be reviewed by the current Government this year.
Meanwhile, the US oil giant is currently preparing for its third potential development project in the Stabroek Block after Liza Phase 1 and 2.
Payara’s development plan includes a floating production, storage and offloading (FPSO) ship, called Prosperity that has the capacity to produce 220,000 barrels a day. The development will have up to 45 wells, including production wells, water injection wells and gas injection wells. Slate is set to start in 2024.