Exxon Mobil expects to be producing oil and gas by 2020 from an area off Guyana where it reported a significant oil find last year, the government said Wednesday. The exploration activity has been a source of tension with neighboring Venezuela which claims a huge swath of Guyana known as the Essequibo.
But Prime Minister Moses Nagamootoo, speaking after high-level meetings here with ExxonMobil Exploration president Stephen Greenlee, said the US energy giant plans to proceed with commercial offshore drilling for oil and gas as early as next year. "What I can say with some assurance is that my impression is that oil extraction would be done long before the time you have stated," Nagamootoo said when asked whether oil would be pumped before Guyana's general elections slated for 2020.
A source who took part in the meeting with Greenlee said ExxonMobil plans to begin drilling a second exploratory well next month in an offshore field near where its Liza 1 well struck oil last year. The source said "there is a lot of oil and a lot of gas" at the Liza well and projections are that the second well to be drilled next month would have even larger gas reserves.
"It's the perfect time to drill because the equipment is about half the price and it is available," a Guyanese official said, speaking on condition of anonymity. The announcement in May 2015 of a significant discovery of high quality oil in an offshore concession 190 kilometers (120 miles) off Guyana set off a round of recriminations between Venezuela and its eastern neighbor.
Venezuela, which has long had claims on Guyana's Essequibo region, has charged that the concession was in disputed waters. President Nicolas Maduro issued decrees extending Venezuela maritime boundaries to include the seas off the Essequibo region that makes up two thirds of the territory of the former British colony, and declaring those waters as part of its integrated defense zone. Guyana maintains that valid land borders were set in 1899 by an arbitration court decision, a decision Venezuela has never recognized.