BRIEF HISTORY & EVOLUTION OF GUYANA'S OIL & GAS INDUSTRY
The possibility of Guyana having petroleum stemmed from observations of petroliferous occurrences recorded by Dutch explorers since the 1750s, but it was not until 1916 that the first significant effort to locate petroleum was undertaken.
“In the 1700s several inconsequential oil seeps were discovered. Dutch explorers in the 1750s discovered flotsam pitch,” – Guyana’s Oil Odyssey, 1750-2019.
According to records from the Guyana Geology and Mines Commission (GGMC), three exploration wells were drilled in 1916 in the Waini area of the South American country’s North West District by Nelson Cannon. Gas and pitch were recorded in one of those wells. In 1926 a well was drilled on the West Coast of Berbice at the Bath Sugar Estate. The gas recovered there was utilized for decades at that location for domestic purposes.
In the 1940’s, companies such as Shell, Total and Mobil, in their quest to discover oil in this part of South America, conducted several geological survey onshore Guyana and drilled several wells in the Takatu basin in Region 9.
In 1966/67 Shell drilled six wells on the Atlantic coast at Drill Mahaicony, along the Berbice River, Corentyne River, and in the Skeldon area.
The quest for petroleum offshore Guyana began in 1958 when California Oil Company conducted seismic surveys before withdrawing in 1960. Other companies followed and several licenses were awarded. The first company to spud a well was Tenneco during 1967 when Guyana Offshore # 1 and # 2 were drilled.
“In the late 1950s, McBride Oil and Gas Corporation tried Guyana as well as Standard Oil of California. Again, there was no success. Again, there was a hiatus when no further exploration was conducted until 1965,” – Guyana’s Oil Odyssey, 1750-2019.
(Sources.https://oilnow.gy/featured/guyana-history-with-oil-dates-back-centuries, https://en.wikipedia.org/wiki/Petroleum_exploration_in_Guyana#:~:text=Guyana%20has%20a%20history%20of,drilled%20a%20number%20of%20wells.)
In 1999, the late former President Janet Jagan granted ExxonMobil 600 petroleum blocks in the Stabroek Block of the Atlantic Ocean for Exploration and that decision has resulted in Guyana being position as one of the country with very large deposits of oil.
In 2008, ExxonMobil subsidiary Esso Exploration & Production started exploring the country’s offshore territory, and in May 2015, it became the first company to discover significant hydrocarbons reserves, through its Liza-1 well in the Stabroek block. Guyana now has estimated recoverable resources of at least 8 billion boe (Barrel of Oil Equivalent) in the Stabroek Block, from which production is expected to hit around 750,000 boepd by 2025. Esso has now made more than 18 discoveries in the block, and having achieved first oil at Liza in December 2019, and is currently working to bring production to its phase-one target of 120,000 bopd. (Source: https://theenergyyear.com/market/guyana/)
Exxon Mobil has developed the Payara project which is expected to commence in 2024.This project includes floating production, storage and offloading (FPSO) vessel, and is expected to produce 220,000 barrels per day. This development is similar to the Liza Phase 1 & 2 projects. This project is expected to have 45 wells, including production wells, water injection wells and gas injection wells. I n October 2020, the Guyana Government after arriving at an amicable agreement signed the Petroleum Permit which has paved the way for a US$ 9 Billion investments in the Payara Project.
The president of Guyana Dr. Mohamed Irfan Ali expects the gas to shore project to come on stream by the end of 2023. This project once delivered will provide Guyanese with affordable energy. With this we can have natural gas-powered energy so that our energy cost can come down. Significant opportunities exist for foreign investors in the gas to energy sector.