Exxon must tell Guyanese why Gas-to-Energy is being pursued if there is no excess gas – Dr. Adams

May 19, 2023 ExxonMobil, News, Oil & Gas

Kaieteur News – In justifying the lack of a feasibility study for the Gas-to-Energy (GTE) project, ExxonMobil has claimed that there is no excess gas in the Stabroek Block.

The 2016 Production Sharing Agreement (PSA) the oil company signed with the Coalition government stipulates that a feasibility study must be done to utilize the excess gas in the Stabroek Block.

Article 12.1 (b) of the Exxon contract states, “…If there is any excess Associated Gas in the Oil Field after utilisation pursuant to Article 12.1(a) the Contractor shall carry out a feasibility study regarding the utilisation of such excess Associated Gas of such Oil Field.”

Former EPA Head, Dr. Vincent Adams

Exxon was accused by the Alliance For Change (AFC) of breaching the sanctity of contract principle since there is no evidence of this document by the company.  In an attempt to clarify its position, ExxonMobil Guyana on Tuesday evening told this newspaper that there is no need for the study as there is no excess gas in the Liza field.

Former Head of the Environmental Protection Agency (EPA), Dr. Vincent Adams in an invited comment on Thursday said the response by the oil company was “disingenuousness to its core.”

Dr. Adams, a Petroleum Engineer reasoned, “First, if they are claiming that there is no excess gas, why have they agreed to build the gas to shore pipeline? For what other purpose would it be used? Also, are they now saying that they do not have the gas to supply the gas plant that is moving forward at a rapid pace? Then why are they supporting it?”

He also pointed out that the 50 million cubic feet of gas per day needed for the gas plant is “a drop in the ocean”, as it accounts for only about two percent of the gas production rate that could be close to two billion cubic feet per day when other production activities come on stream to meet the one million barrel per day target.

In addition, Dr. Adams said, “It is untruthful to suggest that produced gas is absolutely necessary to reinject into the reservoir to maintain reservoir pressure. Water injection does exactly the same and could be substituted. They are injecting water readily available from the ocean right now and can increase it by that small amount to make up for the loss in gas.”

The former EPA Head argued that Exxon never sought to share on the importance of reinjecting the produced gas when they were engaged in flaring billions of cubic feet of gas. This also brings into sharp focus, the company’s argument that there is no excess gas. According to Esso Exploration and Production Guyana Limited- ExxonMobil Guyana-, “The Associated Gas produced from the Liza Oil Field is with priority used for the purposes related to the operations of production and production enhancement of the Liza Oil Field, in accordance with Article 12.1(a) of the Stabroek Block Petroleum Agreement.” It went on to note, “EEPGL has established through numerous studies that all of the associated gas produced from the Liza Oil Field is fully utilized for production and production enhancement purposes. Therefore, there is no excess Associated Gas and a feasibility study for excess Associated Gas is not required under Article 12.1(b).” The company also shared that gas produced at Liza is used for fuel and re-injected to improve oil recovery.

• feasibility study, gas, gas-to-energy, petroleum, utilization