Offshore Technology

Guyana finalises production sharing agreements for five offshore blocks

These agreements are pivotal for the exploration of new offshore areas in both shallow and deep waters.

Guyana's Government has accepted PSAs with multiple energy companies for the exploration of five offshore oil and gas blocks, reported Reuters, citing the energy ministry.

Cybele Energy, Delcorp, International Group Investment, Petronas, Qatar Energy and TotalEnergies are the companies that have reached agreements.

These agreements are pivotal for the exploration of new offshore areas in both shallow and deep waters.

This development follows a 2022 tender that attracted bids for eight blocks, as part of efforts to diversify the country's energy sector, which is currently dominated by an ExxonMobil-led consortium.

The Exxon group is also in discussions with the government regarding the exploration of offshore area S8, with a keen interest in carbon capture and storage within the block. The PSA for this block is currently under review.

The head of Guyana Exxon told the publication that separate negotiations are underway with Exxon, Hess and CNOOC regarding their joint bid.

However, the final documents for the awarded areas are yet to be signed, indicating that the agreements are in the final stages of completion.

The energy ministry also said that a response is awaited from Sispro Energy regarding its offers for two of the blocks.

Additionally, this month, Guyana's tender board announced that VHE Consulting had secured a $1.5m (G$313.3m) contract to audit Exxon's expenses and Guyana's oil profit share for the 2021–23 period.

In May 2024, a Guyana Government official announced that the cabinet had granted Qatar Energy, TotalEnergies and Petronas approval to begin exploration of the shallow water block S4.

This approval came as part of the country's inaugural competitive auction for 14 offshore blocks launched in September 2023.

As of July 2024, ExxonMobil planned to drill up to 30 wells at its latest project in Guyana, known as Hammerhead.

This project, the company's seventh in the nation, is expected to commence production in 2029 and is expected to increase Guyana's oil output to more than 1.4 million barrels per day.