Monday, February 6, 2023

CGX, Frontera say Corentyne license in ‘good standing’ with Guyana government

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The Corentyne Block co-venturers, CGX Energy and Frontera Energy, insisted Thursday that their license is in good standing with the government of Guyana.

This defense of the license came as news circulated that Guyana’s new model production sharing agreement (PSA) would include safeguards purposed to prevent companies from sitting on licenses without meeting their commitments. Vice President Dr. Bharrat Jagdeo made this point in November when asked about delays related to CGX’s Corentyne work programme. The company has also had difficulty meeting timelines for the Demerara and Berbice blocks which it held, and the Berbice Deepwater Port.

CGX said, further to its November 28 announcement, that the delay of the Noble Discoverer’s arrival to Guyana is due to circumstances beyond the joint venture’s reasonable control. The Discoverer was scheduled to arrive in Guyana on October 22 from Trinidad, after use by Shell. CGX later indicated that due to this circumstance, the joint venture would endeavour to drill the Wei-1 well in Guyana by January 31, 2023.

In this regard, the joint venture said the Guyana government agreed to its declaration of force majeure regarding the second phase of the second renewal period of the Corentyne Block Petroleum Agreement and the corresponding extension of the deadline from November 27, 2022 to January 31, 2023.

Noting that force majeure is a procedural step, which preserves its interests in Corentyne, the joint venture said that it remains committed to executing drilling activities there. The partners said the government has confirmed that the license remains in full force.

Professor Suresh Narine, Executive Co-Chairman of CGX’s Board of Directors, is quoted as saying: “All pre-drill activities are complete and all necessary services, materials and support vessels are contracted [for the drilling of Wei1]. Declaring force majeure is a necessary step in preserving the Joint Venture’s interests in the Corentyne license. We are grateful for the ongoing support and understanding we have received from the Government of Guyana as we mutually work to unlock the potentially transformational opportunity before us in the Corentyne block.”

The Corentyne Block partners have estimated a 56% chance of success for the drilling of Wei-1. This was upped from 29% following new results from the drilled nearby Kawa-1 well.

Orlando Cabrales, Chief Executive Officer of Frontera, said: “Looking ahead, we are firmly focused on building on the Joint Venture’s recent light oil and condensate discovery at the Kawa-1 well and successfully spudding the Wei-1 well and the tremendous opportunity that is now before us on the Corentyne Block in one of the most exciting exploration areas in the world.”

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