Guyana’s government approves Exxon’s $10B offshore oil plan
GEORGETOWN, Guyana – Guyana’s government has granted permission for ExxonMobil to develop a fourth offshore oil and gas field, and the company said Monday it has made a final investment decision on the $10 billion project aimed at producing up to 250,000 barrels per day.
Guyanese authorities announced approval of the Yellowtail Project on Sunday, adding to the company’s Liza One, Two and Payara fields.
“Yellowtail’s development further demonstrates the successful partnership between ExxonMobil and Guyana and helps provide the world with another reliable source of energy to meet future demands and ensure a secure energy transition,” the company said in a statement.
The new project is expected to come onstream by 2025.
It said that nearly two dozen successful oil wells since the first in 2015 allows it to so far have access to more than 10 billion barrels of oil in the Guyana Basin.
The first barrel of oil was pumped offshore in December 2019, making the country of about 800,000 people one of the world’s newest oil producers.
The approval comes as a debate between the company and several rights and environmental groups on whether adequate insurance is in place in the event of an oil spill that could affect neighboring continental and tourismdependent Caribbean countries by devastating economies and marine life.
Former Guyanese environmental chief Vincent Adams said Monday the company must be made to have adequate insurance and not allowed “to water down” the language in legal documents linked to the issue.
He said the environmental agency had agreed with Exxon during his time as environmental administrator to ensure there was at least $2.5 billion in oil spill insurance coverage.
The company, which controls the high-yielding Stabroek Block along with American-owned Hess Oil and the China National Offshore Oil Corp., says it has at least $2 billion on standby in addition to the “financial capacity to meet our responsibilities for an adverse event.”
The company recently said it is already preparing to apply for approval for a fifth oil field, and could be ready to submit final documents by the last quarter of this year.