Guyana
Over the last decade, Guyana has been transformed from an impoverished nation to one of the world’s biggest oil and gas success stories. Offshore discoveries by ExxonMobil and partners in the Stabroek Block have resulted in an estimated 11 billion bbl of recoverable oil resources, with the potential for far more discoveries.
In late 2023, ExxonMobil connected its latest floating production, storage and offloading (FPSO) vessel, named Prosperity, to the Payara project, boosting the country’s production to over 600 000 bpd. Projections call for a total of 12 FPSOs producing up to 1.5 million bpd by 2027.
While most production is destined for export, Guyana is keenly interested in developing its domestic economy. The offshore discoveries, for instance, contain a significant proportion of associated gas. In hopes of reducing expensive fuel imports, the government negotiated a US$1.9 billion gas-to-power project with ExxonMobil to monetise the gas. The project includes a US$1 billion pipeline that extends 225 km from the Stabroek block to a 300 MW power plant near Georgetown. ExxonMobil has almost completed the pipeline, but the power plant is about six months behind schedule, and government officials now expect it to come online in late 2025.
Venezuela
Venezuela sits at the opposite end of the spectrum in the region. With an estimated 304 billion bbl of reserves, the country has seen its output plummet from over 3 million bpd to an estimated 800 000 bpd in early 2024. Much of the problem can be attributed to mismanagement, corruption, and a lack of maintenance. The immense 940 000 bpd Paraguana refinery complex has been the scene of a score of failures. In mid-2023, the fluid catalytic cracker (FCC) at the complex’s Cardon refinery failed, resulting in the shutdown of gasoline production. While President Maduro makes frequent headlines promising a return to historic output, independent estimates suggest that the country’s once flourishing oil and gas sector would need at least US$200 billion to restore viability.
Brazil
Brazil is the Latin American powerhouse of oil and gas. By the end of 2023, thanks largely to the pre-salt play, total crude and gas production reached 4.7 million boe/d. State-owned Petrobras has announced plans for 11 new floating FPSO vessels through 2027 alone; analysts expect the country will exceed 5 million boe/d by the end of the decade.
The majority of the country’s production growth (almost 20% in the last two years), has been through state-controlled Petrobras. But now, with the election of Luiz Inácio Lula da Silva (Lula) in 2022, the company has taken a new approach. Under previous administrations, Petrobras had been divesting non-production assets (such as refineries, fertilizers and petrochemicals), to bring down its debt load. Under Lula, asset sales that have not been finalised have been suspended, and US$5.2 billion has been set aside to invest in solar and wind power over the next five years.
While critics say the changes are designed to increase political rather than economic capital, Petrobras is certainly not eschewing the latter. Its 2024 - 2028 budget plan stands at US$102 billion; US$73 billion is slated for exploration and production, primarily in the pre-salt, as well as new frontiers in offshore equatorial regions in northern Brazil and West Africa.
In addition, Petrobras announced in January 2024 that it would finish expansion plans on Train One at its 100 000 bpd Abreu e Lima (RNEST) refinery, nearly a decade after the expansion was halted due to the massive ‘Car Wash’ corruption scandal. Train One will add 15 000 bpd capacity, while Train Two, slated to start in late 2024, will bring total capacity up to 260 000 bpd when work is finished in 2028.
This article was originally published in the June 2024 issue of Hydrocarbon Engineering magazine. To read the full article, sign in or register for a free subscription.
Written by Gordon Cope, Contributing Editor.