Exxon says its latest discovery offshore of Guyana is not financially viable

FILE PHOTO: A logo of the Exxon Mobil Corp is seen at the Rio Oil and Gas Expo and Conference in Rio de Janeiro, Brazil September 24, 2018. REUTERS/Sergio Moraes

(Reuters) - An oil exploration campaign led by Exxon Mobil Corp XOM.N at the Tanager-1 well in the Kaieteur block off Guyana's coast discovered hydrocarbons but it does not appear to be financially viable on its own, a spokesman for the company said on Tuesday.

As part of a consortium with Hess Corp HES.N and China's CNOOC Ltd 0883.HK, Exxon has made 18 discoveries totaling some 8 billion barrels of recoverable oil and gas in Guyana's massive Stabroek block, southwest of Kaieteur. Production of light, sweet crude from Stabroek's Liza-1 well began last year.

Exxon is also the operator of Kaieteur and holds a 35% stake in the block, where Cataleya Energy Ltd and Ratio Guyana Ltd each hold 25% stakes. Hess holds the remaining 15%.

“We remain committed to evaluating the exploration potential in the Kaieteur Block,” the spokesman said.

Exxon’s oil discoveries have the potential to transform the economy of Guyana, a poor South American country of some 750,000 people that has until now depended on agriculture and mining. But other oil explorers’ discoveries have not been as promising as Exxon’s finds in the Stabroek block.

Westmount Energy Ltd WNRG.L, which holds shares in Cataleya and Ratio, told the London Stock Exchange on Tuesday that preliminary evaluation of the Tanager discovery indicated it contained less-valuable heavy crude. It said it expected the well to be plugged and abandoned in the coming days.

Reporting by Luc Cohen in New York; Editing by Jonathan Oatis and Matthew Lewis