CGX Energy Inc. and the Frontera Energy Corporation, joint venture partners in the Corentyne Block offshore Guyana, have found oil there but have been given two years to determine the viability of production there.
This is according to the Minister of Natural Resources Vickram Bharrat who spoke about the developments at the Block at a press conference earlier this week.
“CGX only holds the appraisal area in the Corentyne area.
“It’s less than 1,000 square kilometres held by CGX currently,” Bharrat told reporters.
Further, Bharrat noted that the two-year extension given to the company for appraisal has already started and will expire next year.
Earlier this year, CGX found oil at its Wei-1 well. That well is located 14 kilometres west of the Kawa-1 discovery in the block. In January 2022, CGX and Frontera found oil at the Kawa-1 well but decided to focus on Wei-1.
It was previously noted that further drilling in the Corentyne block is contingent upon positive results at Wei-1. The joint venture reportedly has no further obligations beyond Wei-1.
Now, CGX only holds this small portion of the Corentyne Block because it relinquished much of the block in keeping with its exploration agreement with the government.
Should the appraisal show that the oil found at the block is commercially- viable, CGX and Frontera can then engage the government on a Production Sharing Agreement (PSA) and produce oil there.
If not, CGX will have to give up the block entirely.
Bharrat noted that this Corentyne Block, if given back, and six of the blocks that did not receive any bids in Guyana’s recent oil auction are among the offshore resources the country will have, possibly for future development.
