CGX Energy said on Friday that the Government of Guyana has indicated it may be open to talks in October as the Canadian company and its partner Frontera Energy seek to reverse the cancellation of the Corentyne Block license.
The companies made two discoveries at the offshore block but saw the license period run out, even after benefiting from an extension, without moving forward to develop the resources. The companies had asked Guyana for another extension to do more work, even as CGX became more strapped for cash and struggled to find a partner to join the venture and help with development work.
The companies hope the talks with the government could address a months-long one-sided standoff over the cancelled license, even as the Guyana government considers offering up the now open acreage to new bidders next year.
CGX and Frontera continue to reject the government’s assertion that the license expired in June 2024. In its statement this week, CGX said the government responded to a notice of intent to arbitrate on July 23, firmly rejecting claims of treaty breaches but noting it “may consider a final meeting… on a without prejudice basis” in October. A decision on whether the meeting will proceed is expected in September, according to the company.
“CGX will not play the government” – says Guyana VP | OilNOW
CGX and Frontera contend that their rights to the Corentyne Block, offshore Guyana, remain valid and enforceable under the Petroleum Agreement and that the license has not been lawfully terminated. The partners reiterated their call for an amicable resolution but warned they remain prepared to assert their legal rights should discussions fail.
The three-month consultation period triggered by the investors’ March notice of intent to arbitrate expired in late June without resolution. The companies allege breaches of the United Kingdom–Guyana Bilateral Investment Treaty and the Guyana Investment Act.
The Guyana government maintains that the license ceased to be in effect as of June 28, 2024, following failure to fulfill the necessary work commitments. Earlier this year, Natural Resources Minister Vickram Bharrat told Reuters the government would offer the block to other interested parties.
The Corentyne Block was viewed as Guyana’s most promising non-Stabroek area for potential oil and gas development, but CGX and Frontera have faced delays and financial constraints in progressing their discoveries.
The partners held a 100% working interest in the block, with Frontera Guyana holding 72.52% and CGX Resources 27.48%, including a 4.52% stake CGX agreed to assign to Frontera in 2023. However, CGX said that the transfer remains subject to government approval.
CGX said it will release its Q2 2025 financial and operational results after market close on August 13.
