Tullow Oil has received preliminary approval to divest from its position in the Orinduik Block, Vice President Dr. Bharrat Jagdeo related August 31.
“On the Orinduik issue, we have in principle agreed that the approval will be given for Tullow to sell its shares to Eco [Atlantic Oil & Gas] and to exit that block,” Jagdeo stated.
Tullow decided to offload its 60% operating stake in the Orinduik Block by selling its subsidiary, Tullow Guyana B.V., to Eco subsidiary, Eco Guyana Oil and Gas (Barbados) Limited. Two heavy oil discoveries were made at Orinduik in 2019, but so far deemed non-commercial situated tantalisingly close to Exxon’s prolific Stabroek Block, expectations had been high. The transition to Eco Atlantic is now set in motion, with intricate financial arrangements including an immediate cash payment and potential future earnings for Tullow based on milestones in exploration and production.
Eco will become operator, with a 75% stake, while a joint venture of TotalEnergies and Qatar Petroleum (TOQAP) holds the remaining 25%.
Yet, even as Tullow’s story in Orinduik winds down, its tale in the Kanuku Block appears far from over. Repsol, the block’s operator, has put forth an application for a new license, given that the 10-year term of its license granted in 2013 has expired. As Tullow holds a position in the Repsol-led consortium, a government nod in favor of this renewal would mean Tullow remains an active player in the Kanuku Block.
“In this case, Tullow would still be part of the Kanuku block, should they get a [renewal],” the Vice President said, of the application.
Jagdeo said they must have seen some potential for discoveries; that they believe, based on the seismic data acquired, that the area has great potential.
Under the spent Kanuku license, Repsol holds the operatorship of the Kanuku block with a 37.5% working interest. Tullow holds 37.5% with TOQAP holding 25%.