CGX yesterday announced that the Company has moved to a new Corentyne petroleum agreement (“Corentyne PA”) and petroleum prospecting licence (“Corentyne PPL”) offshore Guyana effective as of November 27, 2012 under which it is obliged to drill two wells.
A release from the Canadian oil explorer said that both the agreement and licence are renewable after four years for up to ten years. It said that the new Corentyne PA applies to the former offshore portion of the Corentyne PPL, covering 6,212 square kilometres.
The licence is based on Guyana’s revamped specimen agreement but with terms and conditions similar to the former Corentyne PA. CGX said that under the terms of the new Corentyne PA, and during the initial period of four years, CGX is obligated to drill two wells. An application has also been made by CGX for new PA’s to be issued for the former Annex PPL, the onshore portion of the Corentyne PPL, and the Berbice PPL.
Kerry Sully, President and CEO, stated in the release, “We are very pleased to be issued this new PA. It will allow us to start contracting services and supplies for Eagle Deep, the well we have planned to explore the Turonian in the Corentyne PA. Eagle Deep will be a High Pressure High Temperature (HPHT) well, similar to the Jaguar well drilled earlier this year in which CGX held a 25% participating interest. Although that well did not reach the target zone, much was learned that will benefit the drilling of Eagle Deep and other deep wells in the basin. Because of the long-lead time required for HPHT wells, drilling is forecast for the first quarter of 2014.
A number of shallower prospects have also been identified using data from recent drilling and 3D seismic.” In relation to the Georgetown PA, Sully added, “The application is in process under the direction of Repsol Exploración S.A. (“Repsol”), as operator, with the Government of Guyana and the contemplated farm-out of 5% of CGX’s 25% interest in the Georgetown PA to Repsol announced on October 1, 2012 is no longer under consideration.”
Two wells – one in a property wholly owned by CGX and the other partly owned by CGX – came up dry this year. CGX has been attempting to find oil offshore of Guyana since 2000.
