Demerara Block operator, CGX Energy Inc., had told the market as early as February 2021 that it identified several prospects, including an Aptian stratigraphic prospect which was being matured to drill status. However, the company will not be conducting drilling activities in the Demerara Block this year, said Senior Technical Advisor to its Board, Dr. Mark Zoback during a virtual presentation on Monday.
“We’re just so enthusiastic about the potential of North Corentyne. That’s our highest priority,” he said in a response to a question.
CGX plans to drill the Wei-1 well later this year, on the Corentyne Block. In a release Monday, CGX said updated results from its drilling of the Block’s Kawa-1 well indicated the presence of light oil and gas condensate. These results, it said, have increased the chances of discovery at Wei-1 from 29% to 56%.
While the company’s focus is on Corentyne, the technical advisor said the Government of Guyana informed CGX and its joint venture partner, Frontera Energy, that it is required to drill two exploration wells on the Demerara Block per its contractual obligations before February 2023.
CGX Energy bets all assets on US$35M Frontera loan to finance deepwater port, Corentyne Block activities
This leaves little time for the company to complete this aspect of its work program, since it means to drill no wells for the rest of 2022.
Asked whether CGX plans to ask the government for an extension of this deadline, Dr. Zoback said that is still under consideration.
“The [joint venture] and the government of Guyana are in discussions regarding what happens in the future, but our plan is to do a second well in Corentyne and we’ll just have to see what happens in Demerara and Corentyne.”
Government is also urging CGX to carry out its contractual obligations for the Berbice Block, through its majority-owned subsidiary, ON Energy.
Early in the current administration’s term, Vice President Dr. Bharrat Jagdeo had criticised CGX for being slow to meet its work commitments. CGX had been granted a one-year extension to the deadline for drilling at the Corentyne Block in 2020 which it said was necessary because the COVID-19 pandemic delayed its operational activities.