Canadian oil exploration company CGX Energy Inc on Monday, February 10, announced that drilling on the Eagle-1 well located on the company’s Corentyne Petroleum Prospecting Licence has commenced. The company was evicted by Suriname in 2000, from that very site.
The Eagle-1 well will be drilled to a depth of 4250 metres to test the Eocene and Maastrichtian geologic zones, the company said in a release. The well is being drilled by the Ocean Saratoga semi-submersible drilling rig owned by a subsidiary of Diamond Offshore Drilling, Inc, a leading drilling contractor with over 40 years of global drilling experience. Drilling is expected to take approximately 60 days.
CGX’s rig is the second to be drilling for oil offshore Guyana. Repsol also has commenced drilling at the Jaguar 1 site where CGX has a 25 per cent interest in the licence.
CGX President and CEO Steve Hermeston
CGX President and CEO Steve Hermeston commented, “Today marks a significant milestone in the history of CGX. We are returning to drill the Eagle prospect that was halted in June 2000 due to overlapping maritime border claims between Guyana and Suriname.
“Renewed exploration follows over seven years of dedication and cooperation between the government of Guyana and CGX in resolving the maritime boundary between Guyana and Suriname peacefully and finally through the International Tribunal of the Law of the Sea (ITLOS) process.
“Following the resolution of the maritime border, CGX had done two-3D seismic surveys, creating a portfolio of prospects on the Corentyne PPL, Eagle-1 being the first well to be drilled to test the original Eocene prospect, plus a deeper Maastrichtian prospect, both of which are stratigraphic tests. The current location will significantly benefit from the 3D acquired in conjunction with advances in better understanding the optimal position to test reservoirs deposited in deep water environments” added the CEO.
CGX is focused on the exploration of oil in the Guyana-Suriname Basin, an area that is ranked second in the world for oil and gas prospectivity by the United States Geological Service. The company is managed by a team of experienced oil and gas and finance professionals from Guyana, Canada, the United States and the United Kingdom.
Multiple prospects
Drilling at the Jaguar-1 site by Repsol’s Atwood Beacon started on February 7 and could take six months as it goes to a depth of 21,325 feet. So far, Repsol has expended US$52 million on its exploration operations and this figure is expected to reach a total of US$180 million.
The CGX operation at the Eagle well will cost the company some US$55 million. While the cost to operate the Ocean Saratoga will be US$500,000 per day, it will cost US$650,000 per day to operate the Atwell Beacon.
Interest in the Guyana/Suriname basin amplified after explorer Tullow struck oil last year off of French Guiana raising the prospect of the opening of major offshore oil producing fields in South America and boosting its shares.
In his recent address to the National Assembly, President Donald Ramotar said that there is high optimism that Guyana is on the verge of discovering petroleum. He noted that Guyana has been listed by some experts as having the potential of becoming a major player in this sector in the world.
The president did warn, however, that “we have to prepare for this eventually and carefully plan to prevent possibly serious negative effects on the traditional sectors”. Ramotar said Guyana must learn from the experiences of other countries that have passed through that stage already.
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