Govt in talks with CGX for auctioning larger parts of relinquished blocks – VP Jagdeo

…says extension to complete workplan has not been discussed

The People’s Progressive Party/Civic (PPP/C) Government is currently working with Canadian company CGX Energy in order to arrange for larger sections of the Demerara and Corentyne blocks to potentially go to auction in September.

During a press conference on Wednesday, Vice President Bharrat Jagdeo revealed that the Government is in talks with CGX. Those talks, according to Jagdeo, are geared towards getting the Canadian company to agree to larger sections of their relinquished Demerara and Corentyne blocks being auctioned.
“We’re preparing for this. I saw an article about what will be up (for auction), I think they identified five areas. I don’t want to confirm or deny that now, but it’s the relinquished areas. And we’re working with CGX now on a solution. And they should issue a statement shortly that could possibly see more of the Demerara and Berbice blocks being put to the auction.”
According to the VP, the company has to meet its obligations.
“…and I expect by today or tomorrow they will issue a statement on that… That issue came up the last time, and I told you there was a position. They had to meet their obligations, and we’ve had that engagement, and there should be a release soon,” Jagdeo said, adding that it looks positive in that regard.
Asked what CGX would be getting out of this deal, Jagdeo said this is being done with the blocks that are already relinquished. Jagdeo also noted that a further extension for CGX to complete its work plan has not been discussed.
CGX had previously come to an agreement with the PPP Government for a well to be drilled in the Corentyne block by November 2021. The company announced last month that it had found oil in the Kawa-1 well it drilled last year August in that very block.
CGX, which has partnered with Frontera Energy Corporation, had said at the time that it continues to integrate detailed seismic and lithological analysis and pore pressure studies from the Kawa-1 well into preparations in advance of drilling its second well, the forthcoming Wei-1 exploration well that is expected to be spud in 3Q ’22.
“The Wei-1 exploration well will be located approximately 14 kilometres northwest of the Kawa-1 exploration well in the Corentyne Block, approximately 200 kilometres offshore from Georgetown, Guyana,” CGX had said.
“The Wei-1 exploration well will be drilled in water depth of approximately 1912 feet (583 metres) to a targeted total depth of 20,500 ft (6,248 metres) and will target Campanian and Santonian aged stacked channels in a western channel complex in the northern section of the Corentyne Block.”
According to the joint venturers, the findings at the Kawa-1 well mean that the chance of finding oil at Wei-1 has improved from 29 per cent to 56 per cent. They also noted that data from the Kawa-1 and Wei-1 exploration wells will inform future activities and development decisions.
“Based on the Kawa-1 discovery and a better understanding of the tie between seismic and rock type in the northern portion of the Corentyne Block, the Joint Venture has identified additional Maastrichtian, Campanian and Santonian potential in the central channel complexes between Wei-1 and Kawa-1. The central channel complexes are the focus of ongoing technical work,” CGX had also said.
Both the Corentyne and Demerara blocks have been in CGX’s hands for some time without being drilled. Back in May 2019, the Strategic Joint Venture between CGX and Frontera was approved to farm into two shallow-water offshore Petroleum Prospecting Licences for the Corentyne and Demerara blocks. Both of these blocks are adjacent to ExxonMobil’s Stabroek Block, where multiple discoveries have been made. The farm-in joint venture allowed Frontera to acquire a 33.333 per cent working interest in the two blocks. (G3)