— as gov’t gets ‘strict’ with company’s timeline, ability to deliver

THE Government of Guyana has started discussions on the renewal of exploration licences held by Canadian oil and gas exploration company, CGX Energy Inc., and is simultaneously examining this company’s plan to construct a deep water harbour in the Berbice River.
CGX holds three licences in the Guyana-Suriname Basin, a frontier Basin in South America with a proven hydrocarbon system and highly-prospective deep water plays that can be drilled in shallow water.

The three licences held by the Canadian-based oil and gas exploration company are “New Demerara Petroleum Agreement”, “New Berbice Petroleum Agreement” and “Corentyne Petroleum Agreement” acquired in 2012 and 2013.

Those licences were seen as a big achievement because in 2000, the United States Geological Survey (USGS) identified the Guyana-Suriname Basin as having the second highest resource potential among unexplored oil basins in the world and currently estimates mean recoverable oil reserves of over 13.6 billion bbls and gas reserves of 32 trillion cubic ft.
Although receiving those licences between 2012 and 2013, the company is yet to establish a well offshore Guyana, something the new government has expressed concerns about.
“We had a meeting with the Canadian High Commission and representatives from CGX to discuss these very issues… the President (Dr. Irfaan Ali) got involved along with myself and the ministers of public infrastructure… we had a meeting with them, not only on exploration but they are applying to do a deep water harbour… permission was given for all these projects a while now,” said Minister of Natural Resources, Vickram Bharrat, during an exclusive interview with the Guyana Chronicle on Wednesday.

CGX, though facing some setbacks in 2007 because of a now resolved territorial dispute between Suriname and Guyana, has not yet made satisfactory progress in the area of drilling.
One of the company’s recent setbacks was said to be the novel coronavirus (COVID-19) pandemic, but Minister Bharrat said this excuse does not cover the prior three years.
“CGX has been here for a while now… they had an issue with Suriname, but that was resolved, plus there has been no drilling for the last three to four years,” said the minister, adding: “COVID-19 is being blamed, but COVID-19 has only been around for a couple of months now… the President was direct on these issues with CGX, but I am sure the President will comment in-depth at an appropriate time.”

Minister Bharrat said President Ali was strict on issues regarding the company’s timelines and its ability to invest.

CONCERNS
In speaking about some of the President’s concerns, the minister said: “Two areas he was very concerned with was whether they have the money to invest and start now, and whether they will drill, how early they will drill and how early they will start construction of the deep water harbour.”

No penalties were discussed, but the government, as mentioned, is discussing the renewal of the company’s exploration licences and its plan to construct a deep water harbour.
CGX, through its wholly owned subsidiary, Grand Canal Industrial Estates Inc. (GCIEI), had made a request for proposals for the provision of infrastructure services as part of the construction of a deep-water port facility at Crab Island in the Berbice River.
The facility, located 600 meters at the mouth of the Berbice River, when completed, is expected to support the offshore exploration work of CGX and its partners in the Corentyne Block offshore Guyana.

The company, on its website, had said that it is continuing with its plan to protect the health and safety of its employees and all stakeholders, amidst the COVID-19 pandemic.
The company’s alternative working arrangements for employees to work from home in Canada, Guyana and the USA are still in place.
CGX, however, reiterated its commitment to the resumption of operations as soon as possible, and assured that it has been engaged in “constructive”, collaborative discussions with the regulatory authorities in Guyana about the timing of its work commitments here.

With government reopening the international airports, CGX is expected to resume its activities. But, efforts to confirm this with officials of CGX proved futile.