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U.S. oil and gas major Exxon Mobil (NYSE: XOM) has announced on Wednesday that it has made two more discoveries at the Sailfin-1 and Yarrow-1 wells in the Stabroek block offshore Guyana, bringing discoveries on the block to more than 30 since 2015.
Exxon revealed that the Sailfin-1 well was drilled in 4,616 feet of water and encountered 312 feet of hydrocarbon-bearing sandstone, while the Yarrow-1 well was drilled in 3,560 feet of water and encountered 75 feet of hydrocarbon-bearing sandstone.
Exxon did not disclose how much crude oil or gas it estimates the new discoveries to contain, but hiked a previous output forecast for the third quarter from older discoveries in the region.
The company says it has ramped up development and production offshore Guyana at a pace that "far exceeds the industry average”, Exxon’s two sanctioned offshore Guyana projects, Liza Phase 1 and Liza Phase 2, are now producing above design capacity and have already achieved an average of nearly 360K bbl/day of oil. The supermajor expects total production from Guyana to cross a million barrels per day by the end of this decade.
Exxon said a third project, Payara, is expected to launch by year-end 2023 while a fourth project, Yellowtail, could kick off operations in 2025.
Exxon is the operator of the Stabroek block where it holds a 45% interest while partners Hess Corp. (NYSE: HES) and Cnooc (OTCPK: CEOHF) hold a 30% and 25% interest, respectively. Exxon’s oil and gas production are well below record levels, averaging 3.7M boe/day at midyear, in-line with last year but nearly 9% below 4.1M boe/day set in 2016.
XOM stock is currently trading at all-time highs having gained nearly 70% YTD, while its market cap of $442.3B makes it the world's 10th most valuable publicly traded company. Exxon is expected to report another strong quarter when it discloses Q3 results on October 28, with IBES Refinitiv estimating the company will report a record $54.8B annual profit this year.
By Alex Kimani for Oilprice.com
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Alex Kimani is a veteran finance writer, investor, engineer and researcher for Safehaven.com.