Contrary to a Maritime Administration Department (MARAD) notice informing of dismantling activities in the Corentyne block offshore Guyana, Canadian oil company CGX Energy on Thursday said drilling activities are continuing at the Kawa-1 Well.
In response to queries from this newspaper, the company stated, “We would like to clarify that the Kawa-1 Well is not being de-mobilized at the moment, despite some reports to the contrary. Drilling activities continue and the Company will officially release any material information when appropriate.”
Stabroek News gathered that the MARAD notice was erroneously published as drilling activities have been extended and the information at the maritime agency was not updated.
Stephen Thomas, MARAD’s Director General, on Thursday told Stabroek News that the notice would have been published based on the records they have. He said that the company had not provided any updated information on its operations.
MARAD’s notice informed vessel operators that demobilisation of CGX’s exploration drill rig would be ongoing and continue until December 31, 2022, using drill rig MODU Maersk Discoverer.
Providing an update to shareholders on December 16, the company said while they have achieved 90% of the planned footage, drilling has taken longer than originally forecast. It was stated that the initial results suggest an active hydrocarbon system is present at the Kawa-1 location.
It was noted that the extended period of drilling operations is likely to increase the cost of operations. To this end, investors were informed that the current cost estimate of the Kawa-1 Well is now forecast to be approximately US$115-$125 million. It is likely that the oil company will have to seek additional financing to keep the drilling programme active.
The total cost of the project will be provided at the conclusion of exploration of the Kawa 1 Well when the total depth has been reached and results analysed.
The Kawa Well is located in the Corentyne block where CGX is operating alongside its joint venture partner, Frontera Energy, a Canadian petroleum exploration and production company in the business of heavy crude oil and natural gas. Frontera is the majority shareholder in the Petroleum Prospecting Licences for the Corentyne block.
