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Repsol gears for August offshore drilling

Jun 11, 2011 News

…has earmarked US$30M to spend in Guyana

Spanish oil giant, Repsol, has announced plans to start drilling for oil offshore Guyana as early as August.
Already, several pieces of equipment are in the country and a drilling rig currently in Suriname is expected to come here after works there.
Making the announcement Wednesday evening at the Pegasus Hotel, Repsol’s Country Manager, Giancarlo Ariza, disclosed that the well will be as deep as four miles, the deepest in the region offshore Guyana.
Already several holding tanks and other processing equipment have arrived and as at yesterday were sitting in the old J.P. Santos yard, Water Street.
Addressing members of the private sector during the launching of the 2011 Business Guyana, an investor’s guide to Guyana, Ariza said that Repsol is expected to spend over US$170M to drill the well and will be using the Atwood Beacon jack-up drilling rig which is currently doing works offshore Suriname.
Already, the company has signed contracts with several local businesses for port services, transportation, internet, helicopter landing, accommodation and civil works and security. Almost US$17M will be spent on these services, Ariza said.
However, he warned Guyanese to also expect bad news. “It is important to highlight that drilling for oil and gas is very risky because the probability of success is very low.”
While the expectations are high for Guyana, no one can make assurances that oil will be found. “We are willing to make the investments and take the risks and afterwards evaluate the results.”
Repsol came to Guyana in 1997 through YPF Guyana, its Argentinean subsidiary. However, a border dispute in which another rig drilling for CGX Resources was ejected by Suriname authorities saw a seven-year lapse while the matter was being addressed by a special international tribunal.
Repsol will be drilling on its offshore Georgetown Block of 3,735 square kilometers.
The company claims that it has invested US$30M already in seismic and geological studies and other pre-drilling activities.
Repsol holds a 15 percent participating interest in the concession area called Jaguar 1 with its joint venture partners including affiliate YPF Guyana Limited (30 per cent), Tullow Guyana BV (30 per cent) and CGX Resources (25 per cent).
Repsol has oil production operations in Trinidad, Venezuela, Brazil and Peru and employs more than 40,000 persons in over 30 countries.
In 2009, it reported revenues of 48B euros with net profits of 1.55B euros.

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