CGX Energy Inc. said on Friday that well results so far from Kawa-1 are consistent with pre-drill expectations, signaling potential positive results from its first campaign offshore Guyana in over 9 years.
“The well results thus far are consistent with the Joint Venture’s pre-drill geological and geophysical expectations and formations are coming in on depth,” the company said.
CGX said the Joint Venture is looking forward to drilling and evaluating the upcoming well sections and maintaining safe and efficient operations. “The Joint Venture expects the Kawa-1 well to reach total depth in the first half of December 2021.”
On August 22, 2021, the Kawa-1 well was spudded. CGX said downhole drilling operations have been without any significant issues and are on target. Since spudding the well, the Joint venture has successfully run a 36-inch conductor and 22 and 18-inch casing strings. As of September 23, the well achieved the planned casing point at a total depth of 9,900 feet (3,017.5 meters).
“The crews have successfully run and cemented the 18-inch casing which is the third of five planned casing strings, and the well is now currently drilling the next hole section below the current last casing point,” CGX said.
Meanwhile, the company announced that it has entered into a term sheet with Frontera Energy Corporation, the majority shareholder of CGX and joint venture partner in the Petroleum Prospecting Licenses for the Corentyne and Demerara blocks offshore Guyana, for a US$20 million rights offering bridge loan that will enable CGX to continue to fund its share of costs related to the Corentyne, Demerara and Berbice blocks, the Berbice Deepwater Port, and other budgeted costs as agreed to by Frontera. The Rights Offering Bridge Loan is an advance on Frontera’s participation in a rights offering.
CGX intends to use the funds for the exploration and development of the Corentyne and Demerara blocks offshore Guyana and the Berbice blocks onshore Guyana and for the development of the Berbice Deep Water Port in Guyana. These funds as well as additional financing alternatives, are expected to provide the funds necessary to meet all of the Corporation’s short-term liquidity requirements over the next 12 months.