CGX company more upbeat about huge oil finds off Guyana

Guyana Chronicle
October 13, 2000

THE Canadian CGX oil company yesterday reported that an internal technical review has boosted the prospects about huge oil finds in sites in its concession area offshore Guyana.

Driven by Suriname gunboats from the Eagle site off Guyana last June 3 in an incident that sparked a fresh border dispute between the two countries, the firm drilled instead in the lower-ranked Horseshoe West site in July.

That well was not successful and CGX pulled out its drilling rig after Guyana and Suriname failed to agree on the firm returning to explore in the top-ranked Eagle concession which it feels could be a world-class giant oilfield.

The Toronto-based CGX Energy Inc. yesterday said an internal technical review of the Horseshoe well "has enhanced the validity of CGX's Eagle and Wishbone turbidite fan targets." Wishbone is similar to Eagle in potential, CGX has said.

Mr Warren Workman, Vice President, Exploration of CGX, said the company has re-analysed the Eagle and Wishbone targets in light of additional information from the Horseshoe number one well.

"The Eagle and Wishbone targets are turbidite fans and are very different target types from the Horseshoe West stratigraphic unconformity target", he said in a company release.

"The Horseshoe #1 well did not have nearby well control (the nearest prior well was over 90 km away) and failed primarily due to a lack of shale seal. However, there is over 8,500 feet of shale in the 1974 Abary #1 well only 10 km from the Eagle target", he said.

Workman said the seismic anomalies at the Eagle and Wishbone targets "are much stronger than at the secondary Horseshoe West target."

"In addition, the Horseshoe well showed that there are over 5,000 feet of very porous sands, which are well-placed to supply reservoir sands to the downslope Eagle and Wishbone targets", he said.

CGX President, Mr Kerry Sully said the company "is encouraged by the results of the re-analysis of the Eagle and Wishbone data in light of the Horseshoe drilling."

"Notwithstanding recent events, CGX has honoured all the terms of its exploration licence with Guyana, which remains in good standing", he added.

Sully noted that CGX has made the largest recent investment (over US$12 million) on exploration in the Guyana-Suriname Basin and is the only oil company in the last 10 years to complete drilling an offshore well in this basin.

He said the United States Geological Survey (USGS) has recently identified the Guyana-Suriname Basin as one of the highest-ranking unexplored basins in the world.

Sully added: "CGX has been closely monitoring developments on the Guyana/Suriname maritime dispute and is encouraged by recent statements proposing to resolve the issue in a peaceful manner under the auspices of CARICOM (the Caribbean Community)."

"An early resolution of the dispute by the governments of Guyana and Suriname would most likely result in the resumption of exploration activity by CGX and other major licence holders in the Basin.

"In the present environment of high oil prices, an offshore commercial discovery in the Guyana/Suriname Basin would result in major investments and economic benefits to both Guyana and Suriname", Sully said.

"CGX fully supports the ongoing efforts of the governments of Guyana and Suriname to arrive at a suitable, timely agreement, negotiated in good faith and acceptable to all parties", he added.

New Suriname President Ronald Venetiaan and President Bharrat Jagdeo met during the recent summit of South American Presidents in the Brazil capital Brasilia and agreed to resume talks on the dispute under the auspices of CARICOM.

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