OPEC meeting upbeat on future prospects of oil

The Stenacarron drillship

As Guyana inches towards a 2020 commencement of the exploitation of what has been determined to be a potentially fortune-changing oil find, some of the major players in the industry were discussing what is widely believed to be significant global movement towards a historic shift in the demand for oil and oil products driven by growth in the world’s major markets.

On Friday, at the Seventh International Seminar of the Organization of Petroleum Exporting Countries (OPEC) in Vienna, Austria,  officials within one of the world’s most influential cartels were discussing the global growth in demand for oil and its derivatives and what the experts believe are the prospects for a bright future for the industry given signs of robust global economic growth.

All of this was happening even as ExxonMobil was announcing its eighth oil discovery offshore Guyana at the Longtail-1 well, opening the way for further resource development in the southeast area of the Stabroek Block. The US company announced that it had encountered around 256 ft (78 m) of high-quality, oil-bearing sandstone reservoir. The well was safely drilled to 18,057 ft (5,504 m) depth in 6,365 ft (1,940 m) of water after drilling had commenced on May 25.

A senior company official is quoted as saying that the Longtail discovery is in close proximity to the Turbot discovery southeast of the Liza field and that the results are under evaluation though it is already felt that the combined estimated recoverable resources of Turbot and Longtail will exceed 500 million barrels of oil.

It has been reported that ExxonMobil is moving to add another exploration vessel offshore Guyana to the Stena Carron drillship, a move that would bring the number of drill ships on the Stabroek Block to three and which would further underline the extent of the significance which the company attaches to its operations offshore Guyana. The new vessel will reportedly support exploration activities in the block’s various presumed high-value prospects.

As news of the country’s eighth significant oil find generated further excited local chatter about what is now widely believed to be Guyana’s ‘rags to riches’ prospects, a report from the industry specialists oil and gas people.com was itself raising expectations for the longer – term prospects for the oil and gas sector arising out of the deliberations of the Vienna OPEC meeting and more particularly the view that the global economic outlook provides good reason for optimism about the future of the commodity. The views at the OPEC forum appeared to centre around the expectation that current growth trends in the world’s major economies is reinforcing demand not only for oil but for all of the products along its value chain.

In Guyana, sustained and vigorous public discourse about the country’s relationship with ExxonMobil and what Guyana can anticipate from the various contractual arrangements associated with oil recovery has also been attended by ExxonMobil’s own public relations effort during which it has been stressing the important role that the Guyanese business community and local contractors to the oil sector have been playing in the company’s local operations. Among its disclosures are what it says has been its expenditure, along with its project partners, of more than US$24 million with more than 300 local suppliers last year. The company has also alluded to the opening of its Centre for Local Business Development in Georgetown, the objective of which, according to a June 22 Oil Industry News report is “to promote the establishment and growth of small- and medium-sized local businesses.” The report says that  ExxonMobil’s priorities in Guyana “are focused on enabling local workforce and supplier development and collaborating with government to support the growth and success of its economy, both in the energy and non-energy sectors.”

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