CGX Energy Inc. is a Canadian-based oil and gas company focused on exploring for oil in the Guyana Suriname basin. The Company’s licences in Guyana cover 3.3 million acres gross, 3.0 million acres net.
In 1996, the founders of CGX, John Cullen and Edris Kamal Dookie, began negotiations with the Government of Guyana to acquire an offshore concession to explore for oil. CGX and others view the Guyana Suriname Basin as attractive for high-risk exploration for hydrocarbons. The United States Geological Survey (USGS) has identified the Guyana Suriname Basin as having the second highest resource potential among unexplored oil basins in the world with estimated mean recoverable oil reserves over 13.6 billion bbls and gas reserves of 32 trillion cubic ft.
In June 1998, CGX Resources Inc., a wholly owned subsidiary of CGX, was granted the Corentyne Licence by the Government of Guyana. In October 1998, CGX Energy Inc. was formed. The following May, CGX conducted a 2D seismic program over the offshore portion of the concession, identifying two turbidite deep-sea fan targets, Eagle and Wishbone, and two stratigraphic-trap targets, Horseshoe West and East. In June 2000, while setting up to drill on Eagle, the rig CGX had contracted was forced off location by Surinamese gunboats, even though Guyana and Suriname are full signatories to the Law of the Sea Convention. Because CGX had already incurred the financial cost of mobilizing drilling equipment from Italy, CGX drilled its third-ranked target, Horseshoe West, a stratigraphic-trap play that was abandoned as a dry hole. After drilling Horseshoe, CGX relinquished 1 million acres with reduced exploration potential and added the 1 million acre Annex extension to the Corentyne Licence in January 2001.
In 2002, CGX acquired a 25% working interest in the offshore Georgetown Licence located between the Corentyne License and the Annex License. The Georgetown License is subject to a confidentiality agreement with the operator, Repsol Exploracion S.A. The Georgetown License expired November 25, 2012.
Negotiations to resolve the maritime border dispute between Guyana and Suriname were ongoing and on February 25, 2004, the Government of Guyana formally commenced binding dispute settlement procedures under the United National Convention on the Law of the Sea (UNCLOS). On September 20, 2007, the International Tribunal on the Law of the Sea (ITLOS) announced the award in favour of Guyana -- see Maritime Border Resolution.
Research into onshore activities in Suriname, where Staatsolie (Suriname's National Oil Company) has two producing fields (Calcutta and Tambaredjo with 1 billion barrels of heavy oil in place oil) and advancements in technology encouraged CGX to explore the onshore portion of its Corentyne Licence. On September 10, 2003, ON Energy Inc. was incorporated in Guyana, as a wholly owned subsidiary of CGX Energy Inc. ON's principal asset is the Licence rights to the 800,000 acre onshore and near shore portion, the Berbice Block.
In 2004, CGX finalized its purchase of the Pomeroon Block, a 2.8 million acre 100% interest block adjacent to the border of Venezuela. Due to the unresolved maritime border between Guyana and Venezuela CGX has not undertaken any exploration activities on the Pomeroon Block and effective November 19, 2012, the Pomeroon Block reverted to the Government of Guyana.
In 2009, CGX obtained a 50 year land lease from the Government of Guyana located on a 22 hectare plot with 700 metres of frontage on the Berbice River for the construction of a wharf and logistics facility and incorporated Grand Canal Industrial Estates.
In 2012, CGX participated in two offshore wells -- the Eagle-1 well was drilled on the Corentyne License and the Jaguar-1 well (HPHT) was drilled on the Georgetown License. The Eagle-1 well had oil and gas shows and the Jaguar-1 well sampled light oil in two zones. Both wells were abandoned -- Eagle-1 as a dry hole and Jaguar-1 for safety concerns.
On November 29, 2012, CGX announced that the Company transitioned to a new Corentyne petroleum agreement and petroleum prospecting license offshore Guyana, renewable after four years for up to ten years.
On February 12, 2013, CGX announced that the Government of Guyana issued a new Demerara petroleum agreement and petroleum prospecting license offshore Guyana which encompasses the former Annex License as well as a new Berbice petroleum agreement and prospecting license onshore Guyana which combines the former Berbice License and the former onshore portion of the Corentyne License. Both licenses are renewable after four years for up to ten years.