CGX Energy Inc is moving on to drill its next well – Eagle Deep – now that the Eagle 1 well has come up dry, and it is optimistic that an oil find will be made because of the studies done on the area.
Speaking yesterday at a forum held at the Pegasus Hotel and organised by the Private Sector Commission, new Chairman of CGX Dr Suresh Narine said CGX believes that oil and gas production is in Guyana’s future and that is why the company has so far spent US$200 million. He said CGX Energy Inc has spent over 65 per cent of its total expenditure in the Guyana offshore basin since 1997.
“We continue to be firmly focused on our next well – Eagle Deep,” Narine said. “We have been able to confirm that there are [tremendous hydrocarbon resources],” he added.
With regard to overshooting the operational expenditure for Eagle 1, Dr Narine said this is normal in such exploratory drilling. He noted that there was no health or environmental issues during the duration of the drilling at the Eagle 1 site.
He noted that CGX has drilled five wells since commencing its operation and the company continues to be excited about the Guyana-Suriname basin.
Speaking at the forum, CEO of CGX Kerry Sully said the company is confident and optimistic as it moves forward with its programme in Guyana. Sully noted that while CGX’s results at Eagle 1 have been a disappointment, interest in the company’s prospects have been upped because of what it has been able to ascertain from the drill programme.
He said that over the past 18 months, the company has spent some US$135 million. Further, he said that the budget for the Eagle Deep well would be US$160 million. The company is looking at drilling three to five wells in about three to five years.
Sully said the target at the company’s 25 per cent owned concession being drilled at the Jaguar 1 well will be a major discovery. He explained that the Eagle Deep is similar to Jaguar 1, in that it is Turonian in characteristic and the same age as that of Jaguar 1. He said the company is looking for a source with what he described as the right “temperature window.”
Asked whether Guyana has the institutional capacity to manage an oil find and all that comes with it, Dr Narine said no. However, he said it was a process that takes time to develop and that most countries which find oil are not fully prepared to manage it in the first instance.
At this point, an official of the Ministry of Natural Resources and the Environment, Bobby Gossai, said government together with many stakeholders are putting the necessary institutional capacity in place to manage the oil and gas sector.
