CGX/Frontera has not approached Govt to start production – VP

Despite its announcement of a major oil discovery in the Corentyne Block offshore Guyana, Canada-based CGX Energy Inc and its partner Frontera Energy Corporation have not approached the Government on wanting to start production.
“They claim they’ve made discoveries but everything is in their court as to whether they want to move to production, then they have to approach us. I must say at this point in time, in spite of the discoveries, they have not approached us to say ‘we want to now start producing’,” Vice President Bharrat Jagdeo told a press conference on Thursday.
While all of the commercially viable oil discoveries offshore Guyana have so far been made by United States (US) oil giant ExxonMobil and its partners in the Stabroek Block, CGX and Frontera announced in June that they had made a major oil find in local waters.
The discovery was made at the Wei-1 well, approximately 200km offshore Georgetown. The Wei-1 well encountered 210ft of hydrocarbon bearing sands in the Santonian horizon. However, it was explained that rock and fluid samples would be analysed by an independent lab over the next two-three months, to properly define how much oil was found.
CGX’s first discovery in the Corentyne Block, the Kawa-1, struck light oil and gas condensate in May 2022. However, the well was subsequently plugged, with appraisal works expected in future. The Wei-1 well is located approximately 14 kilometres northwest of the Kawa-1 discovery.
Meanwhile, the Guyana Government, through the Ministry of Natural Resources, following the announcement of oil at Wei-1, had emphasised that this discovery reaffirms Guyana’s hydrocarbon potential.
“This recent discovery marks a significant milestone in offshore Guyana’s exploration endeavours, with a total of 45 findings since 2015, reaffirming the country’s hydrocarbon potential outside of the highly productive Stabroek Block,” the Ministry had said in its June 28 statement.
CGX currently holds a 32 per cent participating interest in the Corentyne Block while 68 per cent is held by Frontera, after CGX decided to sell its majority stake last July.
It was explained that as part of the agreement, CGX would transfer 29.73 per cent of its participating interest in the Corentyne Block to Frontera in exchange for Frontera funding the joint venture’s costs associated with the Wei-1 exploration well for up to US$130 million.
Frontera would also provide up to an additional US$29 million for the Kawa-1 exploration well, Wei-1 pre-drill, and other costs. (G11)