While there has been significant oil resources discovered by ExxonMobil in the Stabroek Block, there has also been sizeable gas resources uncovered, estimated at more than three trillion cubic feet in size. Even in the face of this, Exxon and its partners have no intention to commercialise the gas in the near term considering the absence of a commercialisation plan for gas.
The gas discoveries would, therefore, have to be declared as non-commercial. This was noted in a 2019 industry report by a Canadian research firm called Canaccord Genuity Corporation which was shared with the Guyana Standard today.
The report further noted that the gas is going to be injected back into the reservoir by the Stabroek block operators, as the market in tiny Guyana is too small to absorb it and infrastructure to commercialise it onshore or offshore is too costly at this time. The Canadian research firm was careful to note as well that the attractive economics of developing the oil resources offshore Guyana is much more superior to the current economics of producing the gas.
Since February last, the nation’s Energy Department, which is headed by Dr Mark Bynoe, had said that a Gas Development Plan, which includes a feasibility analysis, is underway. He had said that the plan will help the Department of Energy in the understanding of the volumes that would be available for use. The Energy Department is also in communication with ExxonMobil on this front.
Last year November, too, the Energy Department Head had disclosed that the ‘gas to power’ feasibility analysis will also seek to determine where to land the pipeline for transportation of the gas onshore Guyana for domestic use.
Furthermore, the feasibility study will be predicated on work that was done by the Public Infrastructure Ministry in 2017. The Ministry had expended some US$70,000 for a consultancy firm to examine Guyana’s natural gas potential and how this might be used for electricity generation.
From February last to now, the Department has not provided an update on the status of that plan.
