CGX Energy (TSXV:OYL) and Frontera Energy Corporation (TSX:FEC) have made a massive oil discovery through their joint venture, the companies announced on Wednesday.
In a press release, the companies said oil has been discovered at the Wei-1 well, which is just offshore from Georgetown, Guyana.
The well encountered roughly 210 feet of hydrocarbon-bearing sands in the Santonian horizon and completed drilling operations without any incidents.
The companies said they expect to release the drilling rig in early July.
CGX Energy is an energy company focused on oil and gas in the Guyana-Suriname Basin and developing deep-water ports in Berbice, Guyana.
Meanwhile, Frontera Energy is focused on developing and producing crude oil and natural gas in South America.
The companies said the joint venture updated the discovery in the Maastrichtian and Campanian intervals to 77 feet of net pay.
In the coming months, results will integrate into the geologic and geophysical models for the purpose of an updated view of the northern region of the Corentyne block.
The CGX Energy and Frontera Energy joint venture is also expected to be the next conglomerate moving oil exploration projects in Guyana into development.
Over the past few years, the oil and gas industry has boomed in Guyana with more than 11 billion barrels of recoverable oil and gas found by a consortium of companies led by Exxon Mobil.
Moving forward, it is expected that the nation will develop an estimated 1.7 million barrels per day by 2035, which is more than any other offshore basin, including the Gulf of Mexico.
After Wednesday’s announcement, shares of CGX Energy were down 14.72 per cent to C$1.39 as of 3:02 p.m. ET; meanwhile Frontera Energy’s share price was down 1.24 per cent to C$11.16 as of 3:03 p.m. ET.
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