Hess Corp increases shares in Kaieteur oil block

…following joint venture partner’s 5% farm-down

Hess Corporation, which is a co-venturer alongside ExxonMobil and Ratio in the Kaieteur Block offshore Guyana, has increased its shares in the block following a farm down of 5 per cent working interest by Cataleya Energy (CEL).

The Kaieteur Block, relative to Stabroek and Canje Blocks

This means that Hess, which formerly had a working interest of 15 per cent in the Kaieteur Block, will now have a 20 per cent working interest. The announcement was made on Monday by Westmount Energy, itself possessing indirect shares in the 3.3-million-acre (13,535 square kilometre) block.
According to Westmount in its market update, Hess Corp’s increase can also be viewed in the context of the Tanager-1 oil discovery. Back in November of 2020, oil was found but deemed as non-commercial.
“Westmount said high-quality reservoirs were also encountered in Tanager-1 at the deeper Santonian and Turonian intervals, though interpretation of the reservoir fluids was reported to be equivocal and required further analysis.”
“A post-well Netherland, Sewell & Associates-published competent person’s report indicated that the Tanager-1 Maastrichtian discovery contained a “best estimate” unrisked gross contingent oil resource of 65.3 million barrels, with a “best estimate” unrisked net contingent oil resource attributable to the Kaieteur Block of 42.7 million barrels,” the market update said.
But it was further noted that in addition to Tanager-1, there is the prospect of additional oil mapped across a 5750 square kilometre 3D seismic survey. It is located in the southern part of the Kaieteur Block, where the joint venture partners are grading the next potential targets for drilling.
Meanwhile, Executive Chairman Gary Walsh was quoted as lauding Hess’s move to increase its working interest in the Kaieteur Block. According to him, it is consistent with the Stabroek partners’ assessment that the total potential for oil in the basin is double what has been discovered so far. This would make it in excess of 10 billion barrels of oil equivalent.
“We are very encouraged to see Hess, one of the Stabroek Block partners and a leading player in the Guyana-Suriname Basin, increase its working interest in the Kaieteur Block on the back of the 2020 Tanager-1 oil discovery,” said Executive Chairman Gerard Walsh.
“It is also consistent with the view that considerable hydrocarbon resource potential may be present in the newly emerging deeper plays, such as the Lower Campanian-Upper Santonian play, where the 3D seismic data suggests that the channel systems are at least as extensive in area as they are in the shallower Maastrichtian-Upper Campanian Liza play fairway,” he said.
Exxon, through its subsidiary Esso Exploration and Production Guyana Limited (EEPGL) operates the block with a 35 per cent stake, Ratio owns 25 per cent, Cataleya Energy now has 20 per cent, and Hess now holds a 20 per cent stake in the Kaieteur Block. Westmount owns stakes in Ratio (0.7 per cent) and Cataleya (5.4 per cent).
Westmount Energy is also an indirect partner in the Canje Block. The company owns an indirect interest in the Canje Block as a result of its 7.2 per cent interest in the issued share capital of JHI Associates. The Canje Block is operated by ExxonMobil (35 per cent), with Total (35 per cent), JHI (17.5 per cent), and Mid-Atlantic Oil & Gas Inc (12.5 per cent) as partners. (G3)