Oil exploration company, Groundstar Resources has seen its stock price rise as drilling begins in blocks in which the Canada-based company has a stake.
The company has begun to drill in its Takutu Block here and is testing its equipment before going deeper. A note from a company representative on Thursday said the company’s shares have propelled 20% higher in the last two trading days. “The company is firing on all cylinders, with drilling activity evident on all three properties in which it has a carried interest,” the representative said. The stock is expected to continue to rise.
At the moment, the company’s stock remains well below a 12-month target price. “With drilling activity now underway on all of Groundstar Resources’ three properties, the odds that positive developments may be forthcoming over the course of the next quarter have materially increased. While such frontier drilling activity remains high risk in nature, the impact of a potential positive outcome on any of these plays should continue to support the trend towards a more positive assessment of the company’s prospects by investors,” research firm, eResearch Corporation said. It noted that already this seems to be taking place with the company’s shares up smartly in the past two trading days.
Groundstar Resources Limited is a Calgary-based junior oil and gas company actively pursuing international exploration and production opportunities.
The company currently has interests in several prospective oil and gas properties in the Middle East (Iraq), North Africa (Egypt), and South America (Guyana).
Groundstar holds a 10% net working interest in a petroleum prospecting licence in the Takutu Basin here. Farm-in partner, Canacol Energy Ltd., holds the balance and will carry Groundstar’s net interest to first commercial production. Groundstar remains operator of the block through to completion of the first exploratory well. The block is 400 kilometres south of Georgetown.
In late December 2010, Groundstar announced the imminent spudding of the Apoteri K-2 exploration well on the Takutu block on the Karanambo prospect in the Takutu Basin. The well is a 600-metre offset to Home Oil’s Karanambo-1 discovery well. Groundstar is the operator of Apoteri K-2. Mean recoverable prospective resources of 138 million barrels of oil were attributed to the Karanambo prospect in a 2009 report.
Plans for a second exploration well on the block by May 2011 are underway, with the choice of prospect (either the Rewa or the Pirara River) dependent on drilling results from Apoteri K-2. The second well will be operated by Canacol Energy; Groundstar will be carried for a 10% net interest.
In addition, another two wells are expected to be drilled here this year. Repsol and its partners including CGX Energy are expected to drill the Jaguar 1 well offshore Guyana. CGX Energy also plans to drill another well in its Corentyne Block.
In response to a recent article in this newspaper, CGX Resources Inc’s Administrative Manager Tarachandra Khelawan pointed out that ON Energy Inc, an associated company of CGX Energy, drilled three wells in mid-2005.
The wells were drilled at Yukusari, Black Bush Polder; at Hermitage and at Albion. The article had said that Groundstar’s spudding of the Apoteri K-2 well was the first in a decade.