Page 9 - LatAmOil Week 30 2022
P. 9

LatAmOil                                         GUYANA                                            LatAmOil



                         Thus far, Rystad noted, it has been able to keep   220,000 bpd by the third quarter of this year.
                         its offshore projects’ greenhouse gas (GHG)   Meanwhile, work at Payara, the third develop-
                         emissions well below average global levels, prov-  ment target at Stabroek, is ahead of schedule,
                         ing to be a leader in environmentally friendly   and the field is now slated to come on line in late
                         practices as well as in production.  2023 and will deliver approximately 220,000 bpd
                           Guyana’s first upstream project is the Liza   of oil.
                         Phase 1 Development, which ExxonMobil   Yellowtail and Uaru, the fourth and fifth
                         brought on stream at the Stabroek block in   development targets, which will deliver an addi-
                         December 2019. The field’s original production   tional 250,000 bpd of oil apiece, are expected to
                         levels were 120,000 barrels per day of crude oil,   come online in 2025 and 2026 respectively.
                         but recently completed optimisation work has   Covering some 6.6mn acres (26,710 square
                         boosted this volume to 140,000 bpd, according   km), the Stabroek block is operated by Exxon-
                         to the US giant.                     Mobil with a 45% stake, the US independent
                           ExxonMobil launched Liza Phase 2 Devel-  Hess with a 30% interest and China National
                         opment in February 2022, and that project   Offshore Petroleum Corp. (CNOOC) with a
                         expected to see production capacity reach   25% stake. ™


       CGX, Frontera reach financing




       deal for Wei-1 exploration well






                         CANADA’S CGX Energy and its parent com-
                         pany Frontera Energy revealed on July 22 that
                         they had struck an agreement with each other
                         on financing arrangements for Wei-1, the next
                         well in their exploration drilling programme at
                         the Corentyne block offshore Guyana.
                           Currently, equity in Corentyne is split
                         between CGX, the operator, with 66.7%, and
                         Frontera, with 33.3%, in line with the joint
                         operating agreement (JOA) signed between
                         the parties in January 2019. However, the two
                         Canadian companies have agreed to amend the
                         JOA in a way that effectively allows CGX to farm
                         out part of its stake to Frontera, with the equity
                         serving partly as compensation for the latter
                         party’s agreement to cover a large portion of
                         exploration drilling costs and partly as payment
                         in kind for the latter company’s previous loans
                         to the former.
                           More specifically, Frontera will, in exchange
                         for CGX’s transfer of 29.73% of its participating
                         interest in Corentyne, cover up to $130mn of the
                         costs incurred by the CGX/Frontera joint ven-
                         ture in drilling the Wei-1 well plus up to $29mn
                         in other costs associated with the drilling of   Both drilling sites are in the northern section of Corentyne (Image: Frontera/CGX)
                         the Kawa-1 well, Wei-1 pre-drilling operations
                         and other activities. Additionally, Frontera will   in Corentyne.
                         accept CGX’s transfer of 4.94% of its participat-  Instead, it will have a 32% stake in the pro-
                         ing interest in Corentyne as consideration for   ject, and Frontera will have a 68% participating
                         repayment of the principal still outstanding for   interest, the statement noted. It did not reveal
                         two outstanding loans – a $19mn convertible   whether CGX would relinquish its position as
                         credit extended in May 2021 and a $35mn con-  operator of the block, which is already home
                         vertible credit extended in March 2022 – plus   to one confirmed hydrocarbon discovery at
                         $3.8mn.                              Kawa-1.
                                                                The statement reported that the two Cana-
                         New majority shareholder             dian companies were now expecting to spud
                         When these transfers of equity are completed,   Wei-1 in October of this year but did not reveal
                         CGX will no longer be the majority shareholder   the reasons for postponing drilling.



       Week 30   27•July•2022                   www. NEWSBASE .com                                              P9
   4   5   6   7   8   9   10   11   12   13   14