Exxon Mobil Corp, received Friday approval from the Environmental Protection Agency of South America to start work on its fourth offshore oil field in Guyana.
Exxon will be able to start construction and operate its Yellowtail project with the permit. This is one of up to ten projects that are expected to produce oil in this decade. Exxon is still waiting to make a final decision on financing the project.
A spokesperson for Exxon confirmed that the approval was granted.
Exxon and its partners Hess Corp and CNOOC Ltd began exploring the Guyana coast in 2015 and have discovered more than 10 million barrels of oil.
Yellowtail was the 13th discovery by the consortium in the Stabroek Block, which covers 6.6 million acres (26.800 km2) and is one of the most significant oil discoveries in South America.
The company stated that the project could produce up to 250,000 barrels per day when production begins in 2025. Exxon proposes a Yellowtail development plan that would involve up to three ships drilling up 67 wells.
According to a Guyana EPA statement, routine flaring and venting natural gas is prohibited under the Guyana EPA permit. Exxon must also keep an undersea device called a capping stack that can seal a well in case of an accident.
The EPA stated that partners must have insurance to cover environmental damage and provide Guyana with an indemnity in the event that they fail to fulfil their obligations.
Exxon’s new floating production, storage, and the offloading vessel was launched earlier this year. This will increase the oil production capacity of the company to over 340,000 barrels per day.
