Tullow Oil reveals discovery of ‘higher quality’ crude offshore Guyana

Tullow Oil PLC has revealed a higher quality oil discovery offshore Guyana, in the Carapa-1 well within the Kanuku licence.

The well hit only 4 metres net oil pay, which was below pre-drill expectations, however, the discovery is in the Cretaceous play and it is higher quality crude – rather than the heavy, sulphurous oil found last year in the Orinduik licence block.

Tullow shares were hit heavily, as were shares in Orinduik partner Eco Atlantic Oil & Gas, in the fourth quarter as analysis of earlier results and samples revealed that the oil found in the Joe and Jethro wells was of lower value and would potentially require additional processing.

Oil found in the Carapa well, however, was tested and confirmed as 27 degree API crude with a sulphur content below 1%.

Significantly, the Carapa result suggests an extension of the Cretaceous play from Exxon’s prolific Stabroek licence (which has seen 15 successful wells, for around 6bn barrels of crude resources) in Kanuku.

It also supports the expectation that the adjacent Orinduik block retains “significant potential” for the Cretaceous play.

"The Carapa-1 result is an important exploration outcome with positive implications for both the Kanuku and Orinduik blocks," said Mark MacFarlane, Tullow chief operating officer.

“While net pay and reservoir development at this location are below our pre-drill estimates, we are encouraged to find good quality oil which proves the extension of the prolific Cretaceous play into our acreage.

“We will now integrate the results of the three exploration wells drilled in these adjacent licences into our Guyana and Suriname geological and geophysical models before deciding the future work programme."

Source: Proactive Investors