A larger FPSO unit and subsea systems could be in store for the second phase of the ExxonMobil-operated Liza development offshore Guyana.

Jeff Woodbury, vice president of investor relations for ExxonMobil, gave an update on operations offshore Guyana on the company’s fourth-quarter 2017 earnings call. ExxonMobil has submitted an application for an environmental permit to develop Phase Two of the Liza development as Phase One progresses on schedule toward first oil in March 2020.

“We have production capacity of 220,000 barrels of oil per day with startup expected by mid-2022,” Woodbury said of the Liza Phase Two facility concept.

Liza Phase One remains on track. Conversion of the very large crude carrier to an FPSO vessel is progressing, and development drilling is set to start later this year.

ExxonMobil affiliate Esso Exploration and Production Guyana Ltd. (45%, operator) and partners Hess Guyana Exploration Ltd. (30%) and CNOOC Nexen Petroleum Guyana Ltd. (25%) have discovered more than 3.2 Bboe of estimated recovered resources on the Stabroek Block, which spans more than 26,800 sq km.

The Payara discovery is now being planned as the third development offshore Guyana, according to Woodbury said. Development here will follow Liza Phase 2.

“Payara has the potential to raise Guyana’s production to about 450,000 barrels of oil per day in total,” Woodbury said.

The update followed news in early January that ExxonMobil and partners had added to success story offshore Guyana when the Ranger-1 well struck oil.

Greg Hill, president and COO of Hess, noted the Ranger-1 well struck 70 m (230 ft) of high-quality oil-bearing carbonate reservoir and pointed out that its location 97 km (60 miles) northwest of Liza says the play is working in terms of charge. He fielded several questions from analysts Feb. 5 on the company’s fourth-quarter earnings call on the topic.

“We see a number of additional features on the block. That says that the carbonate system is working. Now, obviously we’ve got to get wells in those eventually,” Hill said. “But it bodes very well for the block in Guyana and potentially even Suriname as well.”

Plans are for a delineation well to be drilled at Ranger later this year.

The discovery followed the Liza, Payara, Snoek, Liza Deep and Turbot discoveries, proving another new play on the block.

Hill put the locations of some of the discoveries in perspective, noting in particular Turbot’s location 48 km (30 miles) southeast of Liza and Ranger’s location northwest of Liza show the petroleum system is working across the entire area.

“It also opens up other play types as being highly prospective in addition to the carbonates, so there are further play types on the block as well,” he said.

Additional exploration drilling is planned on the block for 2018. This includes appraisal at the Liza, Turbot and Ranger discoveries.

Hill called the developments offshore Guyana as one of the world’s best return investments in the oil industry and we are extremely well-positioned to capitalize on it and to prefund it with the cash that we have not just for FPSO one but for FPSO two. Those financial returns are going to distinguish our company for many years to come.”

So what’s behind ExxonMobil’s success offshore Guyana? Woodbury pointed to technology applied to subsurface imaging, which he said positioned the company to see what others hadn’t in the past.

“You’ve seen the result. We’ve got six very substantial discoveries there and the economics are very robust,” Woodbury said.

He added, “the cost of supply for Guyana is very low. I think we—with our partners—are very well positioned to capitalize on it, and we’re leveraging our global deepwater capabilities in doing do.”

Offshore