Guyana signs Payara contracts with ExxonMobil

ExxonMobil can move forward with its Payara offshore development after the Government of Guyana signed off on a license yesterday.

According to Guyana’s Ministry of Natural Resources, the agreement was approved after reviews of the initial contract and consultations by local and international experts.

In the licensing agreement, the government has declared that routine burn up is strictly prohibited without the approval of the Environmental Protection Agency (EPA). Flaring to maintain oil production will not be permitted.

Esso Exploration and Production Guyana Limited (EEPGL) will pay the government for the cost of gas wasted during flaring and will also be subject to fines under the EPA related to emissions from flaring.

The EPA will establish a framework for a price on carbon to conform to international standards.

The EEPGL will manage wastewater produced to an international standard to minimize the effects of pollution. EEPGL is required to update its base design to include tie-in points and space for produced water injection equipment.

EEPGL will also carry out a study, which will be overseen by the minister of natural resources.

The study is expected to be completed by the first quarter of 2021 and it will examine the safe and efficient reinjection of wastewater, including the effects on the reservoir.

The project in the Stabroek Block is expected to produce up to 220,000 barrels of oil per day after startup in 2024, using the Prosperity, which is a floating production, storage, and offloading vessel.

The US $9 billion Payara development will target an estimated resource base of about 600 million oil-equivalent barrels and the largest single investment in the history of Guyana.