Exploration well off Guyana on track to reach total depth in December
Following the spud in August 2021, the Kawa-1 exploration well, located offshore Guyana, is on track to reach total depth in the first half of December 2021. So far, the well results are consistent with pre-drill geological and geophysical expectations.
The Kawa-1 well is located on the Corentyne Block where CGX Energy is the operator and Frontera Energy is its partner. CGX Energy is a Frontera majority-owned subsidiary and its joint venture partner in the Demerara and Corentyne blocks.
The Kawa-1 well was spud on 22 August 2021, using the Maersk Discoverer rig. Downhole drilling operations have been without any significant issues and are on target and, since the spud, the joint venture has successfully run the 36-inch conductor and 22 and 18-inch casing strings, Frontera informed on Friday.
As of 23 September 2021, the well achieved the planned casing point at a total depth of 9,900 feet (3,017.5 meters). The crews have successfully run and cemented the 18-inch casing which is the third of five planned casing strings and the well is now currently drilling the next hole section below the current last casing point, the company said.
According to Frontera, the well results thus far are consistent with pre-drill geological and geophysical expectations and formations are coming in on depth. The Joint Venture expects the Kawa-1 well to reach total depth in the first half of December 2021.
Loan from Frontera
Frontera and CGX also announced they have entered into a term sheet for a $20 million rights offering bridge loan that will enable CGX to continue to fund its share of costs related to the Corentyne, Demerara and Berbice blocks, the Berbice Deepwater Port, and other budgeted costs as agreed to by Frontera. The rights offering bridge loan is an advance on Frontera’s participation in a rights offering announced by CGX on Friday.
The $20 million rights offering bridge loan from Frontera will be available to CGX for drawdown in tranches on a non-revolving basis until 31 October 2021 or such later date as determined by Frontera. The loan contemplated by the term sheet remains subject to customary conditions, including the negotiation and execution of definitive agreements between Frontera and CGX and obtaining regulatory approvals. There is no guarantee that definitive agreements will be executed on the terms contemplated, or at all.