Wednesday, December 7, 2022

Guyana-Suriname basin continues to manifest hallmarks of prolific hydrocarbon province – Westmount Energy

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Even though it has been six years since the world-class Liza-1 discovery, the Guyana-Suriname Basin continues to hold captive, the interests of explorers as it manifests the hallmarks of a prolific emerging hydrocarbon province, says Gerard Walsh, Chairman of Westmount Energy Limited.

In his company’s latest financial statements, Walsh noted that more than 50 wells were drilled in the basin since 2015 which led to the discovery of more than 11 billion oil equivalent barrels discovered between Stabroek and Block 58 (with estimated 70% oil or liquids) and a total basin potential now estimated to be more than twice the discovered resource.

Taking this performance into consideration, Walsh said the basin continues to be an “outlier” in terms of global exploration performance and investment growth. Walsh further noted that large prospects, high success rates and continuous aggressive exploration and appraisal drilling has catapulted Guyana in particular to the number three position for proven oil reserves in the Latin America-Caribbean region. He said these advantaged barrels, characterised by low breakeven costs, low carbon emissions and potential for rapid commercialisation, are likely to continue to make Guyana a preferred destination for deepwater exploration and production investment.

Expounding further, Walsh noted that in October 2021, on the back of a string of exploration successes, estimates of gross discovered resources to date on the Stabroek Block alone have been revised upwards to approximately 10 billion barrels of oil equivalent. He noted that successful exploration and appraisal wells reported during the last 15 months include Redtail-1, Yellowtail-2, Uaru-2, Mako-2, Longtail-3, Turbot-2, Whiptail-1, Whiptail-2, Pinktail-1 and Cataback-1 bringing the total number of reported significant discoveries to date on the Stabroek Block to 21. In addition, 15m barrels of oil bearing, Santonian, sandstone was reported in the Hassa-1 well, which is located proximal to the Canje block boundary. These frenetic activity levels are supported by the current deployment of six drillships, offshore Guyana, with a 7th drillship plus one semi-submersible rig operating offshore Suriname.

In the Surinamese sector, at the south-eastern end of the basin, Walsh noted that two additional stacked pay discoveries were announced by the Total/Apache consortium in Block 58, during this period – Kwaskwasi-1 and East Keskesi-1 – bringing the number of reported discoveries on the block to four.

These discoveries reported light oil and gas-condensate pay in the shallower Campanian reservoirs overlying light oil pay in deeper Santonian reservoirs. Appraisal of these discoveries has commenced, with Total as operator, targeting FID for the first development in early 2022 and first oil by the end of 2025. Iinitial appraisal progress has been mixed with early success at Sapakara South-1, disappointments at Kwaskwasi and Keskesi East-1, and the general challenges around valorization of large associated gas volumes.

Walsh recalled that in December 2020, Petronas announced a discovery at the Sloanea-1 exploration well on Block 52, where several hydrocarbon-bearing sandstone packages with good reservoir qualities were encountered in the Campanian.

Be that as it may, he noted that exploration drilling results continue to support the presence of multiple plays, quality reservoirs and the potential for stacked-pay drilling opportunities within the basin.

With the foregoing in mind, Walsh said Westmount’s strategy will remain one of offering shareholders exposure to high impact drilling outcomes in the Guyana-Suriname Basin via material indirect holdings in some key licences. In this context, and in spite of the access challenges, he said, “Your Board remains focused on investment opportunities and deployment of capital that gives additional exposure to drilling in this prolific emerging basin.”

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