Guyana may scale back LNG plans as Exxon needs more gas for its wells, sources say

HOUSTON, Oct 13 (Reuters) – ExxonMobil (XOM.N) has told Guyana it will need more offshore gas to ​maximize oil production than the government had expected, potentially leaving less for liquefied natural gas production and exports, two people close the talks said.

Guyanese officials are now weighing whether to shrink a planned LNG project or skip exports altogether and use the gas for domestic power and petrochemical facilities only. It would deal a blow to the South American nation’s ambitions to become a regional energy powerhouse as it continues to grow oil and gas output. Guyana has been pushing ​a consortium led by Exxon, which controls all of the country’s crude and gas production, to deliver as much gas as possible ​so that the nation can monetize its reserves, which rank among the largest in the region.

But the Exxon group, which also includes Chevron (CVX.N), opens new tab and China’s CNOOC (600938.SS), opens new tab, is forecasting it will need about 2 billion cubic feet per day (bcfd) of gas for reinjection into oilfields ​so it can meet crude output targets at its government-approved projects, the people said.