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ExxonMobil Commences Liza Field Production Offshore Guyana

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Exxon Mobil Corporation (XOM - Free Report) recently announced the commencement of production from the deepwater Liza field, located offshore Guyana in the Stabroek Block, well ahead of schedule. Following its first discovery of oil and gas, the company brought the field online in less than five years. Notably, around 1,700 people — marking more than 50% of its workforce — working for the company’s Guyanese operations are localites. 

In the next few months, oil production from the field’s first phase is expected to hit 120,000 barrels per day (BPD). It will take only a few weeks to sell the company’s first cargo. Last August, an oil production vessel, Liza Destiny had arrived at the Stabroek Block, marking Guyana’s first floating, production, storage and offloading (FPSO) vessel. The FPSO vessel moored 190 kilometres off the coast of Guyana and four subsea drill centers, which support production from 17 wells, during the first stage of development.

The company is planning on bringing a second FPSO vessel for the phase 2 development. The Liza Unity FPSO vessel, expected to have a 220,000 BPD production capacity, is currently under construction. This May, ExxonMobil authorized the $6-billion Liza Phase 2 project that is expected to commence within mid-2022.

The third development, named Payara, is still awaiting approvals. It will have a FPSO vessel named Prosperity. The company expects the Stabroek Block to produce 750,000 BPD by 2025 with five FPSO vessels. In the past few months, the largest publicly-traded energy mammoth has increased reserve estimates off the coast of Guyana to more than 6 billion barrels of oil equivalent, following a series of major oil discoveries. Notably, ExxonMobil considers deepwater Guyana and the booming Permian Basin as major growth drivers.

ExxonMobil owns a 45% stake in the Stabroek block, with Hess Corporation (HES - Free Report) holding a 30% interest. The remaining 25% stake at the block is owned by CNOOC Petroleum Guyana Limited, a subsidiary of CNOOC Limited (CEO - Free Report) .

Price Performance

ExxonMobil has gained 2.6% year to date against 1.3% decline of the industry it belongs to.

Zacks Rank and Stock to Consider

Currently, ExxonMobil has a Zacks Rank #3 (Hold). A better-ranked stock in the energy sector is CNX Resources Corporation (CNX - Free Report) , which has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

CNX Resources’ earnings estimates for the current year have witnessed four upward revisions in the past 60 days versus no movement in the opposite direction.

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