Guyana's Oil Spigot Wide Open: Exxon, Hess Sanction Massive $12.7B Oil Project

Exxon Mobil Corporation XOM and Hess Corporation HES made a final investment decision for the Whiptail development offshore Guyana following receiving the required government and regulatory approvals. 

The Whiptail project, worth $12.7 billion, will target an estimated resource base of more than 850 million barrels of oil and include up to 10 drill centers with 48 production and injection wells.

Notably, ExxonMobil Guyana Limited holds 45% interest in the Stabroek block, Hess Guyana Exploration Ltd. holds 30% interest, and CNOOC Petroleum Guyana Limited holds 25% interest.

Related: Exxon Considers Natural Gas Project In Guyana: Report

Whiptail, the sixth project on the Stabroek block, is projected to add around 250,000 barrels of daily capacity by the end of 2027.

The Stabroek Block is 6.6 million acres, and the production from the six Stabroek Block developments is expected to generate tens of billions of dollars of revenue. 

Also Read: Guyana’s Oil Spigot Sputters: Production Delays Reportedly Hit Revenue

The cumulative spend of ExxonMobil Guyana and its contractors with Guyanese suppliers since 2015 surpassed $1.5 billion at the end of 2023.

The Floating Production Storage and Offloading (FPSO) vessel for the Whiptail project (to be named Jaguar) is under construction, and three FPSOs are currently operating and producing over 600,000 barrels of oil daily. 

The companies said that the construction is underway on FPSOs for the Yellowtail and Uaru projects, with Yellowtail and Uaru anticipated to start production in 2025 and 2026, respectively.

“We are excited to sanction Whiptail, our sixth oil development on the Stabroek Block, and remain on track to have six FPSOs online by the end of 2027 with a total gross production capacity of approximately 1.3 million barrels of oil per day,” Hess Corp CEO John Hess said. 

Price Action: XOM shares are up 1.29% at $123.36, and HES shares are up 0.47% at $158.38 on the last check Friday.

Photo via Shutterstock