Tullow raises Guyana wildcat drilling guidance

Tullow Oil expects three offshore wildcat wells due to be spudded in Guyana this year will have a one-in-four to a one-in-five chance of success, versus previous guidance of 15%, according to the London-based company's exploration and subsurface director Angus McCoss.

Improved guidance follows the success of the neighboring Hammerhead-1 well on the ExxonMobil-operated Stabroek block.

Drilling of the Jethro prospect, the first of two wells planned on the Orinduik block, is scheduled to begin next quarter, and spudding of the Carapa prospect on the Kanuku block in 3Q19, the company said.

Speaking during the operator's 2018 results presentation on Wednesday, McCoss said that Jethro (1,350m water depth) and Carapa (70m water depth) are targeting 100Mb and 200Mb, respectively. The net well cost for Jethro is US$30mn and US$20mn for Carapa, he added.

When asked if Tullow was in talks with ExxonMobil regarding possible unitization, McCoss said that no commercial discussions were underway between the two companies regarding Hammerhead's extension into Orinduik.

In a related note, Mark Bynoe, director of Guyana's energy department, announced the drafting of a new template for best practice production sharing agreements (PSAs), and a PSA model toolkit to allow probabilistic scenario models of the current PSAs and the development of a new model contract.

"This tool kit helps us to design future licensing around strategy by varying the assumption under which those strategies or the contracts will be developed, defining the approach for deep water, shallow water and onshore licensing together with modelling PSAs that will be offered," the country's public information department (DPI) quoted Bynoe as saying.

In addition, the energy department is conducting a legal review and gap analysis of existing oil and gas sector legislation that is due to be completed by month-end. Guyana's exploration and production act dates back to 1986 and does not address gas, DPI reported.

OTHER TULLOW ACREAGE

Across the border in Suriname, where Tullow holds offshore blocks 47, 54 and 62, the company farmed out a 30% interest in block 47 to Pluspetrol for a carry on a future well, and says work continues to mature prospects for this area for potential drilling in 2020.

Elsewhere, the company said it continues to work with Peru's hydrocarbons licensing authority Perupetro to execute the licenses for offshore blocks blocks Z-64, Z-65, Z-66, Z-67 and Z-68.

Tullow is also waiting on Peru's government to approve a farm-in of offshore block Z-38 ahead of possible drilling next year.

And the UK company said it continues to mature prospects at Jamaica offshore license Walton Morant for potential drilling in 2020, and will exit Uruguay offshore block 15 next month after potential prospects were deemed too high risk.