Exxon slashes Guyana crude output due to gas compressor problem


Adds comments from Exxon, background

GEORGETOWN, April 13 (Reuters) - Exxon Mobil's XOM.N Guyana unit said on Tuesday it had reduced crude output at its offshore Liza-1 project to 30,000 barrels per day (bpd), down from 120,000 bpd, due to a mechanical problem with the offshore platform's gas compressor.

Exxon said the problem with the compressor's discharge silencer prompted it to reduce output to maintain gas injection and power supply and minimize gas flaring. It said a team from Exxon, equipment manufacturer MAN Energy Solutions and vessel operator SBM were assessing repairs.

The incident marks the third time Exxon has reduced crude output on the Liza Destiny floating production, storage and offloading (FPSO) vessel due to gas compressor problems since output began in December 2019.

"ExxonMobil Guyana is extremely disappointed by the design issues and continued underperformance of this unit," the company said in a statement, adding that it would work with MAN and SBM to "rectify the situation."

"This performance is below ExxonMobil's global expectations for reliability."

Neither MAN nor SBM immediately responded to requests for comment.

Exxon, which operates the Stabroek block where Liza is located as part of a consortium with Hess Corp HES.N and China's CNOOC Ltd 0883.HK, has discovered more than 8 billion barrels of recoverable oil and gas off Guyana's shores, making the South American country the world's newest energy hotspot.

The discoveries are set to transform poverty-stricken Guyana's mining- and agriculture-dependent economy. Still, officials have repeatedly pressured Exxon to limit flaring of associated natural gas from crude extraction operations, citing the environmental impact.

(Reporting by Neil Marks in Georgetown Writing by Luc Cohen Editing by Chris Reese and Sam Holmes)

((luc.cohen@thomsonreuters.com; +58 424 133 7696; Reuters Messaging: Twitter: @cohenluc))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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