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Payara Prospect Project Guyana

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Payara Prospect Project

Payara Prospect Project

Payara is a prospective oil drilling project found in the Stabroek block off-shore of Guyana, the payara prospect project site is being operated by Exxon’s Esso Exploration in conjunction with Production Guyana. It’s found only 20km northwest of the Liza phase 1 project which is also on the Stabroek Block, and covers a total area of 6.6 million acres. Moreover, statistics show that it has an overall water depth of 2,030m and carries around 500 million barrels of crude oil.

Spudding for the Payara Prospect Project was done in November 2016, with the well reaching its full depth a month later. The site was officially discovered by the Stena Carron drillship which is owned by Stena Drilling Co. It’s a mono-hull drillship that’s approximately 228m long and 42m wide, with a functional draft of 12m. Furthermore, the drillship is fitted with a drilling tower and NOV dual hoisting, with the ability to operate at a maximum digging depth of 10,668m.

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ExxonMobil Payara Prospect Project

Before drilling began for the project, ExxonMobil had earlier announced in January that they had found 29m of ‘high quality oil-bearing sandstone reservoirs’ at Payara-1. Later on in July 2017, the successor Payara-2 appraisal rig was dug to a depth of 5,812m and 2,135m in water. Just like its predecessor, the well encountered 18m of top-quality sandstone oil reservoirs.

The highest shareholders for the operation are Esso Exploration and Production Guyana, who jointly own a share of 45pct. They are closely followed by Hess Guyana Exploration and the CNOOC Nexen Petroleum Guyana Co., who own 30pct and 25pct stake in the block respectively. Hess Corp has invested $350 million for drilling of wells on the Stabroek Zone, the funds will not only go to the recent Payara oil discovery but also other new exploration prospects.

Despite the oil discovery, Exxon is still drilling 2 additional sidetracks at the site to evaluate the viability of their find, plus a well test will also be carried out to further assess the rig results. If they turn out positive, Stabroek Block’s estimated gross recoverable resource would increase to between 2.25 Bboe and 2.75 Bboe.

According to Exxon’s president Steve Greenlee, ‘Payara-II confirms the 2nd large scale oil field discovered in Guyana.’ Together with other adjacent satellite discoveries at the Liza Deep, they will pave the way for substantial developments in the oil sector and also provide massive socioeconomic benefits to Guyana. The company is also committed to continue evaluating the full potential of Guyana’s Stabroek Block. These further appraisals will provide useful information for formulating development programs for the project.

Stabroek is estimated to contain multiple other prospects and oil drilling opportunities apart from the Liza and Payara discoveries, indicating multi-billion barrels of unrisked exploration potential.

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Matt Blomerth of the Wood Mackenzie Group says that ‘It’s not common that a nation like Guyana goes from 0 to 60 so quickly like this.’ Upon completion, Wood Mackenzie estimates that the Payara Prospect Project would produce around 180,000 barrels of oil per day until 2030.

The company also assumes another Floating Production Storage and Offloading (FPSO) unit would be required at Payara. Meanwhile, projecting a stable Brent oil price of $65 per barrel, the project’s net value of reserves could range anywhere between $426 million to $1.6 billion. This figure is based on the low case model situation of 300 million barrels of oil reserves available for extraction, or production of 100,000 bpd. On the high side, it could be a production capacity of 500MMboe or 150,000 barrels per day.

Experts say that Payara’s closeness to Liza allows for better economies of scale and will foster the region’s development. Furthermore, the Guyanese government’s approval of an oil & gas service station on Crab Island worth US$500 million will give more impetus to the project. It will create new career opportunities and increase the prospects for finding jobs in the oil sector.

In addition to oil, both Liza and Payara projects are estimated to hold gas volumes of between 2.1 to 2.5 Tcf, when extracted this will greatly boost the profits of the oil rig.

Global natural resources consultancy agency, WoodMac, estimates that activities at the Payara site will continue at a quick pace, also adding that Guyana is swiftly joining the ranks of major oil and gas producers in the world following this major discovery. Thanks to ExxonMobil and Spectrumgeo.com for the heads up on this latest project which is just what the industry needs right now.

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