Exxon has given a further boost to the future prospects for Eco Atlantic Oil & Gas Ltd (CVE:EOG, LON:ECO) as the US oil supermajor green-lighted the development of the Liza field, offshore Guyana.
It is the latest in a series of positive milestones for the emerging offshore oil region, where Exxon has unearthed discoveries of up to 2.4bn barrels and where Eco has prime exploration acreage.
Liza is located immediately east of Eco’s Orinduik block and now that Exxon has green-lighted the project through final investment decision it is on course to be the region’s major production centre.
Exxon expects to start-up Liza by 2020. The field is due to yield some 120,000 barrels of oil per day during the initial production phase which is projected to cost around US$4.4bn.
Ramping up exploration programme
Eco is advancing its exploration of Orinduik where it significantly increased the scale of a 3D seismic acquisition programme.
Originally a 1,000km 3D survey was planned but Eco and partner Tullow Oil (LON:TLW) have now agreed to increase this to the entire block area, or 2,550km, fully overlapping current prospective 2D leads and downdip trends.
The decision to expand the seismic programme followed Exxon’s successful discoveries.
Tullow will carry Eco’s share of the originally proposed 1,000 square kilometres of the survey, at a cap of US$1.25mm, with the balance of the program being funded by both parties on a pro-rata basis.
Eco excited to see Exxon advance Guyana-Suriname basin
Colin Kinley, Eco’s chief operating officer, earlier this month said: “In addition to de-risking the existing two defined targets, the survey will hopefully generate additional targets on the Orinduik Block, thereby increasing the prospective oil in place and adding leads for future work programs.
“We were keenly interested in this region of the Guyana-Suriname Basin even prior to Exxon's highly successful drilling program, applying for the Orinduik block in 2014 because of its highly prospective Cretaceous canyon and fan plays.
“We have since been excited to see Exxon continue to successfully prove out the region in its ongoing drilling program and look forward to results from our own 3D survey, which are expected to come in the next couple of months".
"The 2D interpretation has led to at least two significant reservoir leads on the Orinduik block that both we and Tullow believe may hold significant oil comparable to the world class regional discoveries identified by Exxon.
“Eco Atlantic expects to confirm a number of drilling targets with this increased 3D Survey, ahead of drilling of the first well in Orinduik, hopefully in 2018."