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Can OPEC+ Boost Oil Prices Next Year?

Can OPEC+ Boost Oil Prices Next Year?

OPEC+ will have to factor…

Exxon’s Drilling Offshore Guyana Uninterrupted

Exxon is still drilling offshore Guyana despite a run-in with the Venezuelan navy last weekend, the company said, as quoted by Reuters. Initial reports from earlier this week said the company has suspended exploration activities in the area where the interception occurred.

The Venezuelan navy intercepted two exploration vessels commissioned by Exxon who is developing the prolific Stabroek block offshore Guyana. The Venezuelans, however, claimed the vessels had entered Venezuelan territorial waters, which the Guyanese foreign ministry slammed as an “illegal, aggressive and hostile act.” The ministry also said it will report the case to the United Nations.

“Exploration and development drilling is continuing in the southeast area of the Stabroek Block,” Exxon said in a statement, although a spokesperson for the company declined to respond to a Reuters question about the two vessels and whether they will continue their exploratory mission.

The run-in, which the Venezuelan side said it had already reported to the UN, relates to a long-running maritime border dispute between Caracas and its tiny eastern neighbor. The dispute had been simmering for decades, but Exxon’s discovery of abundant oil and gas reserves in the Stabroek block heated up the situation. The next nine discoveries only served to intensify Venezuela’s disgruntlement: to date, Exxon estimates Stabroek’s reserves at more than 5 billion barrels of crude oil and natural gas.

This makes ten sizeable discoveries in the three years since Exxon won the rights to develop Stabroek, together with its partner Hess Corp. There are another 17 prospects yet to be drilled, which could boost the reserve estimate for Stabroek even further. Commercial production from Stabroek is slated to begin in 2020 at the first production well, Lisa-1, which is expected to pump 120,000 bpd of crude and natural gas.

For the supermajor, Guyana is a top priority after all these discoveries and a recent report by Wood Mackenzie says the tiny nation could become the second-largest oil producer in South America, behind only Brazil, surpassing Venezuela.

By Irina Slav for Oilprice.com

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