Westmount Energy updates market on Kaieteur Block ownership

The AIM-traded firm said the increase in Hess Corporation's working interest was on the back of the Tanager-1 oil discovery, announced in November, and via the farm-down of a 5% working interest by Cataleya Energy (CEL) to Hess.

It said Tanager-1, the first well drilled on the Kaieteur block, encountered 16 metres of net oil pay in high-quality sandstone reservoirs of Maastrichtian age, and confirmed the extension of the Cretaceous petroleum system and the Liza play fairway outboard from the prolific discoveries on the neighbouring ExxonMobil-operated Stabroek Block.

The well was reported as an oil discovery, which was currently considered to be non-commercial as a standalone development.

Westmount said high-quality reservoirs were also encountered in Tanager-1 at the deeper Santonian and Turonian intervals, though interpretation of the reservoir fluids was reported to be equivocal and required further analysis.

A post-well Netherland, Sewell & Associates-published competent person’s report indicated that the Tanager-1 Maastrichtian discovery contained a “best estimate” unrisked gross contingent oil resource of 65.3 million barrels, with a “best estimate” unrisked net contingent oil resource attributable to the Kaieteur Block of 42.7 million barrels.

In addition to the Tanager-1 oil discovery, a substantial Cretaceous prospect inventory was mapped across the 5,750 square kilometre 3D seismic survey, located in the southern part of the block, where the Kaieteur joint venture partners were currently high grading the next potential drilling targets.

Post the CEL farm-down, Westmount said the Kaieteur joint venture was composed of Esso Exploration and Production Guyana, the operator, at 35%, as well as Ratio Guyana at 25%, Cataleya Energy at 20%, and Hess Guyana Block B Exploration at 20%.

Westmount holds about 5.3% of the issued share capital of Cataleya Energy Corporation, the parent company of CEL, and around 0.04% of the issued share capital of Ratio Petroleum, the ultimate holding entity of Ratio Guyana.

“We are very encouraged to see Hess, one of the Stabroek Block partners and a leading player in the Guyana-Suriname Basin, increase its working interest in the Kaieteur Block on the back of the 2020 Tanager-1 oil discovery,” said executive chairman Gerard Walsh.

“This move is consistent with the Stabroek partners' assessment that the total basin potential of the Guyana-Suriname Basin is now more than twice the discovered resource to date - indicating a potential yet-to-find resource in excess of 10 billion oil-equivalent barrels across the basin.

“It is also consistent with the view that considerable hydrocarbon resource potential may be present in the newly emerging deeper plays, such as the Lower Campanian-Upper Santonian play, where the 3D seismic data suggests that the channel systems are at least as extensive in area as they are in the shallower Maastrichtian-Upper Campanian Liza play fairway.”

At 1344 BST, shares in Westmount Energy were up 2.13% at 12p.