Chief Executive Officer (CEO) for Hess Corporation, John Hess recently told industry stakeholders that the Whiptail discovery which was made at two wells is so significant that it could form the basis for a future oil development in the southeast area of Stabroek Block while adding to the previous recoverable resource estimate of approximately 9 billion barrels of oil equivalent.
During his company’s second-quarter earnings call, Hess was keen to note that the Whiptail-1 well encountered 246 feet of net pay and the Whiptail-2 well, which is located 3 miles northeast of Whiptail-1, encountered 167 feet of net 3 pay – both in high-quality oil-bearing sandstone reservoirs. He said the partners will pursue drilling at both wells to test deeper targets.
Overall, the Hess boss stressed that Guyana remains key to his company’s long-term growth strategy given its low cost of supply and industry-leading financial returns. He said, “We have an active exploration and appraisal programme this year on the Stabroek Block, where Hess has a 30 percent interest and ExxonMobil is the operator. We see the potential for at least six FPSOs (floating, production, storage, and offloading vessel) on the block by 2027 and up to 10 FPSOs to develop the discovered resources on the block – and we continue to see multibillion barrels of future exploration potential remaining.”
As for its three sanctioned oil developments being Liza Phase One, Liza Phase Two, and Payara, Hess said these have a Brent breakeven oil price of between US$25 and US$35 per barrel, while adding, “and – according to recent data from Wood Mackenzie – our Guyana developments are the highest margin, lowest carbon intensity oil and gas assets globally.”
With this in mind, Hess believes his company will remain a leader on high dividend returns for investors.
Following the news of this discovery, Minister of Natural Resources, Vickram Bharrat noted that the two Whiptail discoveries will add to the previously announced gross discovered recoverable resource estimate for the block. As with discoveries prior, Bharrat, like Hess, said the Government of Guyana foresees this new development increasing the potential for additional floating production storage and offloading vessels (FPSO).
In this regard, Bharrat said his Ministry and the Petroleum Sector regulatory agencies remain committed to working with all operators, in efforts to expedite their respective drill programmes as they seek the sector’s expansion.