U.S. oil producers ExxonMobil and Hess Corp have withdrawn from exploring the Kaieteur block in Guyana’s deepwaters, Exxon said on Thursday, after disappointing exploration results.
The exit comes as the producers focus on their larger and highly productive Stabroek block, where more than 11 billion barrels of oil and gas have been discovered so far.
Kaieteur, at 3.3 million acres (13,354 sq km), is about half the size of Stabroek and one of two, smaller non-productive blocks Exxon held.
The companies have transferred their stakes in the block to Ratio Guyana Limited and Cataleya Energy Limited, which originally held the exploration licenses, Exxon said.
Ratio will take over as operator from Exxon, pending government approval. The first well drilled by Exxon in the block was deemed non-commercial. Exxon also has drilled three non-commercial wells in the smaller Canje block.
A consortium composed of Exxon, Hess and CNOOC Ltd control all offshore production in Guyana through the Stabroek block. That block is producing about 380,000 barrels of oil per day.
Exxon plans to have a production capacity of more than 1.2 million barrels of oil and gas equivalent per day from Stabroek by 2027.
"Our withdrawal from the Kaieteur block has no impact on our commitment to seeking further exploration and development opportunities and to generating additional value for the government and people of Guyana," Exxon said in a statement.
Exxon and Hess were among oil companies that submitted bids in an auction for 14 other oil and gas exploration blocks. Results of that auction have not yet been disclosed. Other bidders included TotalEnergies and Qatar Energy.
(Reuters - Reporting by Kiana Wilburg and Sabrina Valle; Editing by Chris Reese and Leslie Adler)