ExxonMobil Guyana Limited, the operator of the prolific Stabroek Block, has officially awarded a Letter of Intent to Saipem for the initial engineering and procurement phase of the Longtail offshore development. The agreement, announced on April 23, 2026, carries an initial value of $150 million and marks a critical milestone in the expansion of Guyana’s deepwater energy infrastructure. This preliminary contract focuses on front-end engineering design and the acquisition of long-lead materials necessary for subsea production systems.
The Longtail field, situated approximately 120 miles off the Guyanese coast, is part of a multi-phase development strategy by ExxonMobil and its partners, Hess Guyana Exploration and CNOOC Petroleum Guyana. The Letter of Intent serves as a foundational step toward a comprehensive Engineering, Procurement, Construction, and Installation contract. According to official project documentation, the total value of the final agreement could escalate to $1.5 billion, pending a formal Final Investment Decision and the receipt of necessary regulatory permits from the Guyanese government.
Saipem’s scope of work under this award includes the design and engineering of subsea umbilical, riser, and flowline systems, as well as the subsea production manifolds. By securing long-lead items at this stage, the consortium aims to mitigate supply chain risks and maintain the development timeline for the Longtail discovery, which was initially identified in 2018. The project is expected to involve the deployment of a dedicated Floating Production Storage and Offloading vessel, adding to the fleet already operating in the Stabroek Block.
ExxonMobil currently holds a 45% interest in the Stabroek Block, while Hess holds 30% and CNOOC holds 25%. This latest award to Saipem follows a series of successful collaborations between the companies on previous Guyanese projects, including the Liza and Payara developments. The Longtail project is part of a broader effort to reach a production capacity of over 1.2 million barrels of oil per day in Guyana by the end of the decade.
The Government of Guyana is currently reviewing the Environmental Impact Assessment and the Field Development Plan for the Longtail area. The $150 million commitment for early-stage work allows the technical teams to proceed with high-level architecture and hardware specifications while the regulatory review process continues. Saipem confirmed that the engineering work will be managed through its offices in Milan and Houston, with significant components of the subsea hardware expected to be fabricated at specialized facilities globally before being transported to the Stabroek Block for installation.