CGX Energy Incorporated, the Canadian-based oil and gas exploration company that is at present in pursuit of petroleum discovery in the Guyana Basin will commence drilling for oil as early as next year.
The company was given the green light to commence operations uninterrupted, after Guyana in 2007 won the Maritime Arbitration Award, following the long maritime border issue with neighbouring Suriname which began in 2000.
Since then the CGX Energy Incorporated has done a significant degree of work and its President and Chief Executive Officer (CEO) Kerry Sully said the company has gone far ahead in its plans to commence drilling.
We are confident that we are going to make a drilling commitment to the government, we don't know where but that doesn't preclude us from working our way through things such as environmental approvals to drill and planning to design a drill programme such that when our final decision is made that we can proceed on an opportune basis, Sully explained.
Explaining the technicalities of the operation, Sully noted that it takes approximately 75 days for drilling and testing and if a discovery is made, the company would proceed to drill appraisal wells to confirm the accuracy of the seismic or geological survey.
The process would then be followed by field development which generally takes the longest time to complete. According to Sully, the duration between discovery and first production usually takes about 8 to 10 years, however there are operations that accomplish the task in a shorter time frame.
When asked why no drilling has commenced in light of the settlement of the maritime issue some three years ago, Sully said the company had since spent more time conducting technical work than is normally done on a basin.
As a result we have gone from, having identified that target of 13,000 feet to about 16,000 feet and that target is far more impressive than our original target and is the kind of a target that would attract world attention, Sully explained.
In January the company had announced that it had completed shooting of the 1,839 square kilometer 3D seismic survey on CGX's 25% Georgetown Petroleum Prospecting Licence (PPL).
The CGX President while making a power point presentation at the Pegasus Hotel alluded to a study in June 2000 which concluded that Guyana is the second most attractive under-explored basin in the world with a potential of 15.2 billion barrels of oil.
Were an oil discovery to be made in the Guyana Basin, the CEO explained that production targets would be estimated at 50 million barrels per year which would be equivalent to 140,000 barrels per day.
Additionally Government would be receiving a cash flow of 53 percent, and the oil company 43 percent. This share was considered favourable to the government when compared to other countries such as Norway, the United States of America, Canada and Argentina.
It was also predicted that the impact on Guyana's development would be phenomenal as 650 persons per year would gain employment.
Sully concluded that the discovery will have a dramatic impact on the region's business opportunities, revenue, employment and training while providing leading edge exploration technology and many oil companies.
CGX began its first solid state 2D seismic geographic exploration in the basin in 1999 and was able to explore some 10,000 feet. In 2000 the company had acquired enough resources to explore further when the border issue with Suriname emerged.
This was however, settled in September 17, 2007 following the work done by a legal team lead by Sir Shridath Ramphal, a former Attorney General of Guyana who ascended to Secretary General of the Commonwealth Secretariat.
Sir Shridath was among those who were present at the CGX press conference and told the Government Information Agency (GINA) that the situation is now very favourable for Guyana since the award has set the stage for a great deal of activities.
Beyond CGX the world's major oil companies are identifying around that discussion so that in the developments that are going to take place now, even between now and the production of oil, there are going to be economic spin offs in terms of the economic activities that are to be generated so what we can look forward to I think is a period not just of high expectations but of high employment, trading opportunities for the moment when we become an oil economy, Sir Shridath Ramphal said.