Corentyne Block oil exploration: Wei-1 project pegged at US$170M, will also appraise Kawa-1

Frontera Energy, the joint venture partner of CGX Energy in the Corentyne Block, plans to invest up to US$200 million in three countries – of which the lion’s share, up to US$170 million, will go to Guyana.
This was revealed in their 2023 Capital and Production Guidance financial paper. In it, they noted that between US$170 million and US$200 million will be invested in exploration projects in Colombia, Ecuador, and Guyana.

According to Frontera, the Wei-1 well campaign in the Corentyne Block is expected to cost between a total of US$160 million and US$170 million, when pre-drill and other related costs are factored in. In terms of costs after 2022, the well will cost between US$120 million and US$140 million. This will be funded by existing resources.
The Wei-1 well is located approximately 14 kilometres northwest of the joint venture’s previous Kawa-1 light oil and condensate discovery and will target Maastrichtian, Campanian, and Santonian aged stacked sands within channel and fan complexes in the northern section of the Corentyne Block.
According to Frontera, the Wei-1 well will appraise both the Kawa-1 discovery that was made just last month, as well as explore additional opportunities within the Corentyne Block. Meanwhile, the financial statement also quoted Frontera Chief Executive Officer (CEO) Orlando Cabrales as laying out their plan for this year.
“In 2023, we will advance the company’s exciting development and lower-risk exploration portfolio in Colombia and Ecuador, invest in infrastructure and facilities at Quifa and CPE-6 to increase production, leverage our advantaged transportation and logistics structure to maximise realised prices, mature our self-sustaining and growing midstream business including Puerto Bahia and ODL, execute our hedging programme to protect our revenue generation and manage our exposure to price volatility and seek to build on our Kawa-1 light oil and condensate discovery with the Wei-1 well, our second exploration well offshore Guyana,” Cabrales said.
Frontera and CGX were initially scheduled to begin drilling the well by November 27, 2022. Additionally, the Noble Discoverer semi-submersible mobile drilling unit that was slated to spud the well was expected to arrive in Guyana’s waters in October last year.
However, in November, the two companies had announced that an agreement was reached with the Guyana Government to start drilling no later than January 31, 2023, to allow contractor Noble Corp Plc to complete current obligations in Trinidad.
Wei-1 is one of two wells in Guyana’s Corentyne Block that the companies have committed to drill. The other well, Kawa-1, struck light oil and gas condensate in May 2022, though the companies had not said how much oil was found or whether it was commercially viable.
The Wei-1 well is located approximately 14 kilometres northwest of the Kawa-1 discovery.
In fact, the joint venture also announced last month that the Guyana Government has approved an appraisal plan for the northern section of the Corentyne Block which commenced with the Wei-1 well.
“Following completion of Wei-1 drilling operations and upon detailed analysis of the results, the joint venture may consider future wells per its appraisal programme to evaluate possible development feasibility in the Kawa-1 discovery area and throughout the northern section of the Corentyne Block,” the missive had detailed.
It further stated that any future drilling is contingent on positive results at Wei-1 and that the joint venture has no further drilling obligations beyond the Wei-1 well. 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 will 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.
Additionally, Frontera will provide up to an additional US$29 million for the Kawa-1 exploration well, Wei-1 pre-drill, and other costs.
CGX and Frontera Energy Corporation had previously commissioned an independent report which had revealed that they were potentially sitting on 4.9 million barrels of oil equivalent (BOE) in the Demerara and Corentyne oil blocks under their control.
In February 2022, the partners had announced an oil find of 177 feet of oil-bearing reserves at the Kawa-1 well in the Corentyne Block. Since then, however, the company has been making moves to scale back its presence in the other blocks.