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ExxonMobil (XOM) Finds More Oil in Stabroek Offshore Guyana

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Exxon Mobil Corporation (XOM - Free Report) recently announced another significant hydrocarbon discovery at the Longtail-3 well, offshore Guyana. In the first quarter of this year, the company added two drillships in offshore Guyana looking for hydrocarbons, taking the total to six at present.

The Longtail-3 well is located in the famous Stabroek Block, wherein it has made numerous world-class oil discoveries so far. The new find adds to the previous estimate of gross recoverable resource of 9 billion barrels of oil equivalent. ExxonMobil discovered 230 feet of net oil pay at Longtail-3, which comprises high-quality hydrocarbon-bearing reservoirs. Notably, the well was drilled by Stena DrillMAX at 1860 meters of water depth and is located almost 2 miles south of the Longtail-1 well. The Longtail-1, having 78 meters of high-quality oil-bearing sandstone reservoir, was drilled in 2018.

The Stena DrillMAX drillship is expected to move on to the Whiptail-1 well next. Another drillship, Noble Sam Croft, is currently working on Liza Phase 2. The company also confirmed Mako-2 evaluation well’s reservoir quality, which might allow it to add a fifth floating production storage and offloading facility to the Liza Complex field development. However, the Koebi-1 exploration well in the Stabroek block encountered hydrocarbons but not in commercial volumes.

ExxonMobil, with a 45% interest, is the operator of the Stabroek Block that covers 6.6 million acres. Partner Hess Corporation (HES - Free Report) owns a 30% interest in the block. The remaining 25% stake is held by a wholly-owned subsidiary of CNOOC Limited.

ExxonMobil recently resumed drilling the Jabillo-1 well in the Canje Block offshore Guyana using Stena Carron, a sixth-generation harsh environment drillship. This year, the company intends to drill three wells in the Canje Block, wherein it plans to replicate the success from the Stabroek Block. ExxonMobil is the operator of the block with a 35% stake. It has TotalEnergies SE , JHI, and Mid-Atlantic Oil & Gas as partners, having 35%, 17.5% and 12.5% interests, respectively.

Price Performance

The stock has gained 23.7% in the past year compared with 15.9% rise of the industry it belongs to.

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Zacks Rank & Stock to Consider

Currently, ExxonMobil carries a Zacks Rank #3 (Hold). A better-ranked player in the energy space is PHX Minerals Inc. (PHX - Free Report) , having a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

PHX Minerals’ bottom line for 2021 is expected to surge 140% year over year.

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