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The equivalent of 1,400 Gulf of Mexico Blocks: Tillerson

Exxon Mobil (ticker: XOM) and Hess Corp. (ticker: HES) announced initial results from the Liza-2 exploration well in the Stabroek block of offshore Guyana.

This announcement follow the success of the Liza-1 well in 2015. The results confirm a world-class oil discovery with estimated recoverable resource for the Liza prospect of between 800 million and 1.4 billion barrels of oil equivalent.

President of ExxonMobil Exploration, Steve Greenlee, reacted to the development: “We are excited by the results of a production test of the Liza-2 well, which confirms the presence of high-quality oil from the same high-porosity sandstone reservoirs that we saw in the Liza-1 well completed in 2015.”

Guyana is in South America wedged between Venezuela and Suriname, on the north side of Brazil. Following the discovery of Liza-1, Guyana has stepped onto the world stage of oil and gas as a hotspot of global exploration.

Exxon CEO Rex Tillerson said, “To put this in perspective, this is the equivalent of 1,400 Gulf of Mexico blocks.”

The Liza wells are located in the Stabroek block approximately 120 miles (193 kilometers) offshore Guyana. The Stabroek block is 6.6 million acres (26,800 square kilometers). The Liza-2 well is located 2 miles away from the Liza-1 well.

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The exploration project in Guyana is a joint venture between three oil and gas companies. Exxon has 45% of the Liza prospect, Hess Corp. has 30% and China’s Cnooc-Nexen has 25%.  The operator of the well is Esso Exploration and Production Guyana Ltd and is an affiliate of Exxon Mobil.

Hess indicated its Liza-2 well encountered over 190 feet of oil-bearing sandstone reservoirs in Upper Cretaceous formations. In a statement, CEO John Hess called it an “exciting prospect” and “world-class” with additional wells planned for the drillship Stena Carron. That vessel stabilized itself in waters 5,551 feet deep while drilling down 17,963 feet into Liza. The rig is starting a new well 25 miles to the northwest.

“We are very encouraged by the drilling results to date of the Liza prospect, which we believe has the potential to materially contribute to our resource base and future production growth,” John Hess said. “In addition to the Liza prospect, we continue to evaluate the resource potential on the broader Stabroek block with additional exploration drilling planned.”


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