ExxonMobil and its partner Hess Corp. have announced that the major discovery off the coast of Guyana, in the north of South America and bordering with Venezuela, is a discovery that is much larger than previously expected.
The Liza field could turn out to be the largest oil discovery reported in two years and the companies say that it could cost US$18 billion to develop. Exxon describes it as a “world-class discovery with a recoverable resource of between 800 million and 1.4 billion oil-equivalent barrels.” That could amount to as much as half of the entire volume of oil discovered across the entire industry in 2015.
“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,” Steve Greenlee, president of Exxon Mobil Exploration Company, said in a statement. “We, along with our co-venturers, look forward to continuing a strong partnership with the government of Guyana to further evaluate the commercial potential for this exciting prospect.”
The Liza 2 well is located 120 miles off the coast of Guyana, and comes after Exxon made an initial discovery last year from its first well drilled in the Liza field. “It is getting harder and harder to make large oil finds,” Leta Smith, a director at consultancy IHS, told the Houston Chronicle. “One of the things that has been troublesome over the past several years is each year we see fewer discovered volumes, since 2012. A lot of the big finds have been gas, rather than oil.” The Houston Chronicle notes that there have only been five discoveries of over 500 million barrels or larger in the past four years.
“This exploration success demonstrates the strength of our long-term investment approach, as well as our technology leadership in ultra, deepwater environments,” Exxon’s Greenlee said.