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Tanager-1 is non-commercial, well to be plugged and abandoned

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The Tanager-1 exploration prospect – the deepest well ever drilled in the Guyana-Suriname Basin to date – is being considered as non-commercial as a stand-alone development.

According to a press update from Ratio Guyana Limited, which has a 25% interest in the Kaieteur Block, the well reached a total depth of 7,633 metres in recent days. Evaluation of LWD, wireline logging and sampling data confirm 16 metres of net oil pay in high-quality sandstone reservoirs of Maastrichtian age.

OilNOW understands the drill campaign at Tanager cost in excess of US$100 million and is a stark reminder of the high-risk nature of exploration drilling, even in a basin where consecutive multi-billion-barrel discoveries have apparently become the norm. Already, on news of the results, Ratio’s stock plummeted by 56% when markets opened in Tel Aviv, where the company is headquartered.

“Preliminary evaluation of the fluid samples from the Maastrichtian reservoir indicates heavier oil than is reported from the Liza Phase I producing field crude assays and these samples will be the subject of further detailed laboratory analysis over the coming months,” Ratio said.

Although high quality reservoirs were also encountered at the deeper Santonian and Turonian intervals, interpretation of the reservoir fluids is reported to be equivocal at this stage and requires further analysis. It is anticipated that the well will now be plugged and abandoned in the coming days.

The Tanager-1 results confirm the continuance of a Cretaceous petroleum system and the Liza play fairway onto the Kaieteur Block, down dip from the prolific discoveries on the neighbouring ExxonMobil operated Stabroek Block. It is anticipated that the Kaieteur Block partners will now conduct a detailed evaluation of the data collected at Tanager-1 with a view to understanding the well result, re-calibrating the seismic model for this part of the basin and high grading the next potential drilling targets on the Kaieteur Block. A substantial prospect inventory has already been mapped across the 5,750 km2 3D seismic survey, which was acquired in the southern part of the Kaieteur Block in 2017.

According to Westmount Energy Ltd., a AIM-quoted energy investing company focused on the Guyana-Suriname Basin, the outcome of the Tanager-1 exploration well has proved to be a mixed bag – confirming the extension of the Liza play fairway onto the Kaieteur Block but apparently coming up short at the deeper stratigraphic levels.

“As Tanager is a stacked pay prospect, success at a number of stratigraphic levels is required to achieve stand-alone commercial discovery volume thresholds,” said Gerard Walsh, Executive Chairman of Westmount. “However, these deeper results must be viewed in the context of the very limited number of penetrations of these deeper plays to date – indicating that exploration of these deeper plays, offshore Guyana, is at an early part of the learning curve.”

Walsh said Westmount shareholders can look forward to the near-term drilling of the next prospects in the portfolio which are independent of the outcome of the Tanager-1 well – including the Bulletwood-1 well, on the Canje Block, which it anticipates will be spudded in late December 2020 or early 2021.

“Bulletwood-1 will target a circa 500 MMbbl ‘Liza look-alike’ confined channel complex of Maastrichtian-Campanian age,” Walsh said.

The Kaieteur and Canje blocks are adjacent to the Stabroek Block which has delivered eighteen substantial oil discoveries since 2015, with reported discovered recoverable resources of approximately 9 billion oil-equivalent barrels to date.

ExxonMobil is operator at the Kaieteur Block and holds 35% interest with Cataleya Energy Limited holding 25%, and Hess 15%. Westmount holds approx. 5.4% of the issued share capital of Cataleya Energy Corporation and around 0.7% of the issued share capital of Ratio Petroleum Energy Limited Partnership.

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