Little public investment and little political stability are the factors that continue to dominate the oil industry in most South American countries. However, countries such as Bolivia, Colombia, Ecuador and Venezuela began to sign agreements with private companies, with the aim of increasing investments in exploration and exploitation. In the latter case, it was possible, thanks to the partial lifting of restrictions established by the U.S., which allowed Chevron to return to Venezuela.
In the case of Guyana, the flow of capital necessary to consolidate its promising future as an oil-producing country continues constantly and regularly.
Bolivia. State oil company YPFB continues to execute the Upstream Reactivation Plan, with a portfolio of 42 projects. The objective is to increase gas production, which is still decreasing.
For 2023, YPFB invested $700 million in different activities, where more than 55% is focused on upstream activities, prioritizing exploration. The results of the Yope-X1, Yarará-X1 and Yarará-X2 wells were positive, while the Churumas-X2 well confirmed production of 9 MMcfd, Fig. 1. Another project was the Remanso-X1, and from this, YPFB is planning the horizontal drilling of a second well, to begin exploiting a fairly important reserve estimated at 0.7 Tcf.
Among the projects in both traditional and non-traditional areas that are in full execution are the Astillero-X1 well, Mayaya Centro-X1 well; plus additional wellsites, where road and plank construction is underway. Drilling will be conducted at these sites in the following months on the Bermejo-X46, Villa Montes-X7, Iñau-X3D, Yapucaiti-X1, and Charagua-X1 wells. All are located in the southern part of the country, which holds the largest reserves of hydrocarbons.
Colombia. At the end of October, the National Hydrocarbons Agency (ANH) published a report that confirms at the end of 2022, there was a slight decrease in hydrocarbon production, where the life of oil reserves dropped to 7.5 years, while natural gas reserves now equate to 7.2 years. The first action of a government plan is to increase efficiency in the exploration and exploitation of existing contracts, through a series of investment incentives for private companies, in which in some cases the extension of the terms of the exploration period was approved.
Regarding exploitation, 300 development wells have been drilled this year through September, which equates to a 4%, compared to the same period in 2022.
Ecuador. According to the new report for the first half of the year, national oil company Petroecuador invested $1 billion, 8% more than the same period in the previous year. The firm drilled 47 wells, or the same number as was drilled in the first half of 2022. Of the 47 wells drilled, the majority were in the ITT Block (22), followed by the Auca (9), Sacha (8) and Shushufindi (5) fields, along with Lago Agrio, Libertador and Oso Yuralpa fields (1 each).
However, the sudden resignation of President Guillermo Lasso at the end of May caused a serious political and economic crisis, to the point that the activities of the oil industry were significantly reduced for several weeks, causing negative consequences for oil production. Petroecuador, which produces more than 90% of the nation’s oil, has been hit by a series of social protests, which have blocked the main access roads to the country's most productive fields.
According to data provided by the Ministry of Hydrocarbons, oil production during first-half 2023 fell from 500,000 bpd to 473,000 bpd. Petroecuador’s share of production went from 378,000 bpd to 368,000 bpd.
Guyana. At the end of September, offshore oil activity intensified to further implement the country’s exploitation program, which consists of the implementation of eight FPSOs by the end of 2025.
There are currently six drillships assigned to ExxonMobil projects offshore Guyana.
And at the end of July, ExxonMobil Guyana confirmed that in 2024, the country's production will increase from 400,000 bopd to 600,000 bopd, thanks to the commissioning of the FPSO Prosperity, Fig. 2. The vessel is the centerpiece of development of Payara field. The FPSO produced first oil on Nov. 14, 2023, and is formally on hire, according to SBM Offshore. It should add 220,000 bopd to Guyana’s output.
In mid-September, ExxonMobil confirmed the start of an exploration campaign at Canje field, which will see the drilling of 12 wells. This should begin during second-quarter 2024 and last until first-quarter 2025.
ExxonMobil's most important drilling is concentrated in three large projects: Yellowtail and Uaru, which will begin oil production in 2025 and 2026, respectively, and Whiptail, will come onstream in 2027.
Peru. According to data from the National Statistics Institute (INEI), investment in the hydrocarbon sector is at low levels compared to previous years. According to data from PeruPetro covering January through September 2023, investment in hydrocarbon exploration reached $2 million and exploitation totaled $200 million. These numbers represent a potential problem for the medium-term future.
From January through September, PeruPetro did not carried out 2D or 3D seismic activities, and drilling totaled 34 development wells. Oil production decreased 12.6% in September, compared to the same month of the previous year. Production of natural gas liquids was 82,000 bpd, which was a 31% increase, compared to September 2022. Natural gas production was 1.676 Bcfd, which is 33.6% more than the level of September 2022.
Venezuela. Oil production for the month of October reached 787,000 bpd, registering a 3% increase, compared to the previous month. However, the small number of operational drilling rigs (5), the precarious oil infrastructure and the continuous blackouts of electricity supply prevent PDVSA from producing greater volumes of oil.
Furthermore, in September, Venezuelan oil production also fell, due to a shortage of diluents.
Due to the partial reduction of U.S. sanctions since November 2022, Chevron plans to add 65,000 bopd to national production. The company aims to recover around 3 billion euros in dividends not paid by the government of President Nicolás Maduro.
As for upstream, the agreement to establish a joint company between PDVSA, NGC (Trinidad & Tobago) and Shell for the Dragon offshore field has entered the negotiation phase, after Shell requested permission from OFAC. This license, extended until Oct. 25, 2025, will allow Shell to operate Dragon field, to bring gas to the Hibiscus platform and transport it to facilities in Trinidad. WO
M.NOGARIN@MEDIASUR.NET