Exxon has revised upwards its reserve estimate for a major oil discovery off the coast of Guyana. The Stabroek block is now seen to hold 25% more crude, at more than 4 billion barrels. What’s more, the actual size of the discovery could turn out to be even larger, according to Wood Mackenzie analysts: It could be up to 1,000 times larger than the average bloc in the Gulf of Mexico.
If Exxon turns out to be right and there are indeed many more billions of barrels in the waters of Guyana, the tiny South American country could become a pretty solid oil producer in the not too distant future, with a potential daily rate of 750,000 barrels by 2025.
It’s good timing for Exxon, as well. Big Oil has faced challenges in growing their reserve base in the last few years as investments in new exploration have stalled in the face of lower oil prices. Now, investments are on the rise but mostly in ongoing production rather than in exploration. Yet Exxon is so upbeat about Stabroek that it has commissioned two drill ships for simultaneous exploratory drilling off the Guyanese coast.
The world’s largest listed oil company reported today disappointing second-quarter results. Earnings per share fell short of analyst expectations, coming in at $0.92 per share, versus forecasts of $1.27, although revenues beat forecasts, at $73.5 billion, versus an expected $72.58 billion.
Deals, Mergers & Acquisitions
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