Canadian-based companies, CGX Energy Inc. and Frontera Energy (OTC:FECCF) Corporation, announced a significant oil discovery at the Wei-1 well in the Corentyne block offshore Guyana today. The joint venture has unearthed 114 feet (35 meters) of net pay, bringing the total net pay discovered on the Corentyne block to 342 feet (104 meters). This new find is similar to the Liza Discovery (NASDAQ:WBD) on the Stabroek block.
The Wei-1 well was drilled by the NobleCorp Discoverer semi-submersible mobile drilling unit to an impressive depth of 20,450 feet (6,233 meters). The costs for this drilling project were estimated to be within $185-$190 million. Frontera stepped in to cover CGX's unexpected additional costs.
Gabriel de Alba, Orlando Cabrales, and Professor Suresh Narine confirmed the successful discovery and its potential. The discovery is seen as a boon for both companies' exploration efforts in South America.
In addition to this announcement, CGX also released its unaudited Consolidated Financial Statements for the third quarter of 2023. As they continue their exploration activities, Houlihan Lokey (NYSE:HLI) has been enlisted to assist with strategic options.
The Wei-1 well's successful discovery of medium sweet crude oil within a high-quality Maastrichtian cored reservoir was announced yesterday. This discovery, along with the previously found hydrocarbon log pay in Maastrichtian blocky sands at Kawa-1 well in 2022, underscored the significant potential of the Corentyne block. Assisted by Houlihan Lokey, the Joint Venture is conducting a review of strategic options for the Corentyne block, including a potential farm down.
The Wei-1 test results revealed 13 feet of net pay in a high-quality sandstone reservoir in the Maastrichtian, similar to the Liza discovery on the Stabroek block. Fluid samples and log analysis confirmed the presence of sweet medium crude oil. In the Campanian, 61 feet of net pay was confirmed.
Frontera's CEO sees potential for future developments in the Campanian and Santonian horizons, which showed 40 feet of net pay with oil indications in core samples. The Wei-1 well operations had no safety or environmental incidents.
CGX and Frontera are considering strategic options for the Corentyne block, including a potential farm-down, supported by Houlihan Lokey. Based on Wei-1 and Kawa-1 wells results, CGX and Frontera have engaged Subsea Integration Alliance (SIA) for a conceptual field development plan for the northern portion of the Corentyne block. They believe that developing the Maastrichtian horizon may be more cost-effective and faster than a broader development.
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