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Exxon Announces New Oil Find in Guyana

Offshore Oil Rig

Exxon Mobil has announced a new, and potentially big, oil and gas find off the coast of Guyana. The oil and gas find was struck in an appraisal well, which is the company’s second success in the tiny South American country.

Last year, Exxon found oil and gas in another offshore well, and at the time, Exxon said that find could be a huge one: a deposit holding up to 700 million barrels of crude worth an estimated $40 billion. Now, after the second successful find, it is planning to drill a third well in the area.

If the estimates of how much oil and gas Guyana has in its shelf come true, it could make a big difference, both for the country and for Exxon.

Guyana does not currently produce any oil and gas, and even with the weak prices for hydrocarbons, its economy would benefit from a new revenue source. In fact, the reserves from the Liza-1 well that was drilled last year—even at current prices—are worth 12 times Guyana’s GDP, which is about $8000 per capita annually. With less than a million people, that brings the GDP to somewhere around $3 billion.

For Exxon, a major new find would be good news in light of its less-than-favorable exploration failure rate, which reached 39 percent in 2014, up from 33 percent in 2013. Now, on top of this, there’s less money for new exploration, which is a problem not unique to Exxon.

Exxon is not the only oil major exploring in Guyana. British Tullow Oil and Spain’s Repsol are also drilling in the area, but have not so far announced any major finds.

By Irina Slav for Oilprice.com

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  • Port Henderson on September 05 2016 said:
    Hopefully the government will get its act together quickly so that, in the long run, the people of Guyana will benefit from the oil. It is important to not end up like Venezuela or Nigeria with rich oil reserves but all the riches go instead to foreign companies, government leaders, and not the hard-working residents of a country.
  • Herman Goodfellow on July 02 2016 said:
    The world can't burn the fossil fuels assets already owned in the ground without destroying human life. When the investment community realizes this, those assets were become essentially worthless, as will the stocks of the companies that own them.
    Global warming threatens to push the earth into a permanently irrecoverable warmer climate
    https://www.scribd.com/doc/306019583/Methane-and-the-Greenhouse-Gas-Footprint-of-Shale-Gas
    See also this dramatization of how the earth's temperature has increased each month over the last 150 years - http://www.climate-lab-book.ac.uk/spirals/
  • Anton on June 30 2016 said:
    Alesha you another PPP support spreading lies. The election were not rig, the PPP lost because their supporter were fed up of the corruption and stealing of the countries fund so they stayed home. The new Gov't which is not perfect is doing a better job at giving a say to the people in how the country is being governed. Hopefully in the future the people can leave the past where it belongs and vote for a Gov't that is for all people.
  • Alesha on June 28 2016 said:
    Hmm Since the USA step foot into a beautiful country name GUYANA, it has been on the verge of a economic collapse. These crooks went there to steal OIL so they rigged the elections, replace the previous government with a poppet and not rigging the OIL out....While economy and other areas in the country suffer....PEOPLE are screaming that business are slow....shows the USA has done a good job trying to get them into bankruptcy state....The USA should be ashamed to be the NEW BRITISH in the days of slavery walking all corner of the globe seeking OIL wealth to boost their economy.....

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