CGX estimates up to 628M barrels at Corentyne Block, plans for first oil by 2030

Dec 17, 2023 ExxonMobil, News, Oil & Gas

Kaieteur News – CGX Energy Inc. and Frontera Energy Corporation joint venture partners have announced their plans to initiate oil production by 2030 in the Corentyne Block offshore Guyana. This goal is based on an estimate that the northern Corentyne area holds between 514 and 628 million barrels of oil equivalent (mmboe) in prospective resources, as discussed in a virtual informational presentation last week.

Gabriel de Alba, Chairman of Frontera’s Board of Directors and Co-Chairman of CGX’s Board of Directors, noted that the estimate is confined to one zone of the block. “The Joint Venture believes that approximately 514 to 628 mmboe PMean unrisked gross prospective resources may be present in the Maastrichtian horizons alone,” de Alba said. He therefore noted the possibility of additional resources in the deeper Campanian and Santonian geological horizons. However, the joint venture is treating the Maastricthian as a priority zone.

The news release also clarified that the estimate considers those quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects. This means the estimate is not purely proven barrels in the Kawa-1 and Wei-1 wells, but it is inclusive of unproven barrels from prospects yet to be drilled.

CGX and Frontera have been working to find sufficient resources to support a standalone commercial oil development, following ExxonMobil’s successes. The partners are actively pursuing options for a potential farm-down of their interests, to bring in a new partner, with advisory support from Houlihan Lokey.

Professor Suresh Narine, Executive Co-Chairman of CGX’s Board of Directors, reflected on CGX’s journey as an early exploration pioneer in the Guyana basin. Despite facing numerous challenges, the joint venture with Frontera has remained steadfast in its focus. “We have weathered border challenges, economic downturns, and unsuccessful exploration wells; our Joint Venture with Frontera has maintained and strengthened this unwavering focus. With successful discoveries at Wei‐1 and Kawa‐1, we are encouraged by the definitive presence of oil in the Corentyne block, and our commitment is being rewarded with potentially commercially viable prospective resources in the Maastrichtian interval with potential upside in the Campanian and Santonian intervals.”

Orlando Cabrales, Chief Executive Officer (CEO) of Frontera, expressed excitement about the discoveries made in the Corentyne block and the prospects of the Golden and Silver Lanes in the Guyana-Suriname basin. The presentation provided insights into the positive results from the Maastrichtian, the unexplored potential in deeper horizons, and the multizone potential in the central area of the block.

The joint venture is currently in the final stages of the exploration phase. It said deepwater projects like this typically require four to seven years from discovery to first oil. It said the complexities of such developments necessitate appraisal drilling, conceptual modeling, and the making of Final Investment Decisions (FID). Following the Wei-1 and Kawa-1 discoveries, SIA, a Subsea 7 – Schlumberger Joint Venture, was tasked with creating a conceptual field development plan for the northern portion of the Corentyne block. The plan encompasses subsea architecture, development well planning, production and export facilities, among other considerations. Further appraisal activities are required to ascertain the commercial viability of the discoveries. The Joint Venture currently holds a 100% working interest in the Corentyne block, with Frontera owning 72% and CGX owning 28%.