CGX rig may start moving out today

Guyana Chronicle
July 21, 2000

THE CGX rig at the centre of the border dispute that flared between Guyana and Suriname June 3, may start moving out from its Guyana offshore concession today, Mr Kerry Sully, President and Chief Executive Officer of the company said yesterday.

The Toronto-based company, however, wants to be back here soon and will be watching closely how talks progress on resolving the row, Sully told the Chronicle in a telephone interview from Vancouver.

"There appears to be a desire to restart these talks soon...we will be watching closely to see how these develop", he said.

In a statement, he hailed the "extraordinary efforts to resolve the dispute made by President (Bharrat) Jagdeo and his non-partisan team, as well as by Prime Minister (P.J.) Patterson of Jamaica and his associates."

CGX Energy Inc. which was awarded a 15,464 square kilometre concession by the Guyana Government in 1998, is moving out its drilling equipment and support services from the Guyana/Suriname basin after talks between the two countries on the dispute collapsed in Jamaica Monday night.

Patterson is mediating negotiations at the request of the Caribbean Community to which Guyana and Suriname also belong.

The statement from the company noted that talks between the governments of Guyana and Suriname over the last six weeks have failed to find a solution to allow the jack-up drill rig under contract to CGX to return unhindered to the Eagle drill location.

It recalled that during the night of June 3, 2000, the drill rig had been forced from the Eagle location by two Suriname gunboats.

Sully said CGX will be looking at "some other international opportunities in order to maximise the options available to us".

But he said the company believes that when the dispute is settled, "at the end of the day, Guyana is going to prove to be a great place to be".

CGX believes it has located at least two potential world class giant oilfields at Eagle and Wishbone, each with deposits of more than 800 million barrels.

It said the Eagle target was being drilled on a licence granted by the government of Guyana in an area of overlap claimed by both countries.

"Historically, over more than 40 years, exploration activities have been conducted by eight companies in the area of overlap under Guyana licences, including an aeromagnetic survey carried out by Exxon (this year), 1999 seismic programmes conducted by CGX and the Maxus/Repsol/AGIP/ENI consortium and drilling by Shell in 1974 to the west of the Eagle target under a Guyana licence (the Abary well)", the statement said.

It noted that both countries have ratified the 1982 UN Convention on the Law of the Sea without exclusions, Guyana in 1992 and Suriname in 1998.

The convention requires peaceful resolution of maritime boundary disputes, it pointed out, adding that in the event a resolution has not been achieved through negotiation, it entitles either Guyana or Suriname to submit the dispute to an arbitration procedure, established by the convention.

Sully said CGX continues to view the turbidite targets as having great importance and will vigorously protect its commercial rights.

"Once the dispute is resolved, CGX intends to drill its Eagle and Wishbone targets", he stressed.

"However, it's extremely unfortunate that this issue of allowing the rig to return wasn't resolved. All necessary equipment was in the basin and the people of both Guyana and Suriname, plus the CGX shareholders could have known the results of the exploration within 45 days", he said.

Frustrated by six rounds of fruitless talks spread over more than a month on the border dispute, Guyana has called off negotiations with the current government in Suriname, President Jagdeo announced Wednesday.

"At this point in time, my government does not intend to pursue further talks with the current government" in the former Dutch colony, he told a news conference at the Office of the President complex in Georgetown.

He squarely blamed the outgoing administration of Suriname President Jules Wijdenbosch for the failure to reach an agreement at the latest talks, despite dogged mediation efforts by Patterson and a top notch team of experts.

Wijdenbosch lost general elections in May but a challenge to some of the results has delayed his departure from office and up to yesterday it was not clear when President-elect Ronald Venetiaan will be sworn in.

Mr Jagdeo said he is looking forward with some optimism to discussions with the new government.

But clearly not pinning hopes in that direction, he signalled that Guyana would take its case to a third party if further bilateral talks do not "yield early results".

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