CGX Energy Inc. entered into a seismic contract with Prospector PTE. Ltd. to conduct a 3116.74sq km 3D seismic survey on Demerara Block, offshore Guyana.
The contract represents one of the most extensive 3D seismic studies ever conducted in the Demerara block that is comprised of an area spanning 3953sq km in the Guyana-Suriname basin.
The total value of the seismic survey is approximately US$17.9 million. About $7 million will be paid to Prospector by issuing 15,534,310 common shares in the capital of CGX Energy and the remainder will be paid in cash 12 months after the seismic survey is complete. CGX expects the seismic survey to be completed within approximately 60 days following mobilization.
The initial phase 1 work commitments are comprised of a 3D seismic survey consisting of a minimum of 1000sq km and the associated processing and interpretation. The survey will provide detailed information on the reservoir distribution and structural integrity of the current leads. According to CGX Energy, this 3D seismic survey will allow the company to better rank its prospects in the Guyana-Suriname basin and define future drilling locations.
Prospector will use its 12-streamer 3D seismic vessel, R/V BGP Prospector, which was specifically built for serving the high-end 3D, 4D and wide azimuth marine seismic survey market. The vessel is outfitted with ION's DigiSTREAMER seismic data acquisition system and has a solid gel design that reduces the risk and noise during broad bandwidth data recording.
CGX says the Guyana-Suriname basin has increasingly demonstrated the potential for hydrocarbons and is gaining significant international exploration attention.
Upon closing, Prospector will own approximately 16.6% of the issued and outstanding common shares. The shares will be subject to a four-month hold period.
CGX Energy owns 100% of the Demerara block.
In June, CGX announced the completion of reprocessing and merging of existing seismic surveys from its 100% owned Corentyne petroleum prospecting license (PPL) offshore Guyana. Those results assisted in confirming and enhancing the geological assessment of the block.
Vector Seismic Data Processing Inc. completed a full elastic seismic inversion and amplitude variation with offset that contributed to the risk assessment of the exploration prospects being considered for the next drilling campaign in the Corentyne PPL.
CGX Energy procured the use of BOT Lease Co. Ltd.’s HAKURYU-12 jackup drilling rig for the project. Simultaneously, CGX entered into a rig sharing agreement with Teikoku Oil (Suriname) Co., Ltd., a wholly-owned subsidiary of Inpex Corp. for Inpex to drill the first offshore well in Suriname in 2015. The spud date for the first development well at Corentyne is set for 31 October 2015.
Image of BGP Prospector, from BGP