After intense review Exxon’s project approved with fines for flaring; production to start in 2024

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The Guyana Government late on Wednesday announced that after a period of intense review by local and international experts it has approved the Payara Offshore Development Project.

That approval comes with a series of recommendations which sees the Government insisting, among other things, that routine flaring is strictly prohibited without the approval of the Environmental Protection Agency (EPA).

The Government and ExxonMobil earlier on Wednesday signed the license for the Payara field offshore development with Natural Resources Minister Vickram Bharrat and ExxonMobil’s Country Manager, Alistair Routledge leading the way.

Prior to the approval, the Government had decided to review the work already undertaken by the Department of Energy and Bayphase Oil and Gas Consultants on the Payara Project with talks of offering transparency and accountability.

Officials sign the agreement [Photo: Natural Resources Ministry/September 30, 2020]
Following the review, the two sides have decided through the licensing agreement that flaring to maintain oil production will not be permitted.

A statement from the Ministry of Natural Resources noted that 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 with international standards.

The statement further added that the Government has insisted that EEPGL manage produced water to an international standard to minimize the effects of discharging produced water.

“EEPGL is required to update its base design to include tie-in points and space for produced water injection equipment.  EEPGL will carry out a study overseen by the Minister of Natural Resources to be completed by the first quarter of 2021 to examine the safe and efficient reinjection of produced water, including the effects on the reservoir. This is in keeping with the government’s commitment to preserving marine life and water quality,” it added.

Moments after the Government issued its statement, ExxonMobil also released a statement on the finalisation of the agreement saying that production in Payara is expected to begin in 2024 with a capacity of 220,000 barrels per day.

Payara is the third project in the Stabroek Block. The $9 billion development will target an estimated resource base of about 600 million oil-equivalent barrels, Exxon said.

Ten drill centers are planned along with up to 41 wells, including 20 production and 21 injection wells.

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1 Comment
  1. Matthew says

    What kinda contract signing is that……I thought de Minister s’posed to sneak off to Bahamas ‘n sign in private…..??? Trotty…….please clarify.

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