Have not posted here in a while...
For shareholders who have invested in either Frontera or CGX - the results from Wei, in my opinion, will exceed expectations.
Recall, pre-drill assumptions (per CGX / Frontera presentations) assumed the maastrichtian and upper campanian intervals at Wei were likely gas / gas condensate. What we now understand (based on information that has been released) is that these reservoirs hold medium to light oil. While data on porosity / permability are forthcoming, I suspect reservoir properties here to be exceptional - in line with what has been reported by analogous wells.
This now opens up the middle fairway where two large upper cretaceous reservoirs - one in the maastrichtian and one in the lower campanian - each stretch more than 10 kilometers - straddle Wei and Kawa.
Emphasis added - the primary target for Wei was the santonian. It will be interesting to better understand the arial extent of these secondary upper cretaceous targets (maastrichtian and campanian) encountered at Wei. If appraised in their optimal/axis locations, the possible improvement we could see in net pay and higher net-to-gross.
In addition, industry also needs to examine and better understand why Haimara and Pluma (maastrichtian and campanian reservoirs) discovered gas / gas condensate reservoirs. And help piece together why Wei, located up-dip from Pluma and Haimara, discovered medium and light grade oil. Of course, the noticeable upcoming exploration prospect called Blue Fin (that will be drilled by Exxon) located just miles for N Corentyne area - where Exxon was very clear on their last earnings call to focus on oil based exploration prospects.
Moving to the santonian, I suspect these reservoirs to be in-line with pre-drill expectations. Holding light oil with exceptional porosity and permability.
To sum up, we have been shared solid results from Wei thus far - much better than pre-drill expectations (hydrocarbon type found in maastrichtian and campanian). We have to wait for a few more months to get all data released.
Let's turn now to the stock price of both companies - performance has been horrendous. Don't care if you own CGX or Frontera - it's not acceptable.
The market will continue to punish both stocks until this venture group can realize value from their Guyana investment. We are talking almost $750M of investments in Guyana thus far - with an expectation another $200M of investment will be required every year in order to further the N Corentyne appraisal / development program. Needless to say, status quo is not acceptable.
You also have the government who have publicly stated on numerous occasioy their displeasure with N Corentyne progress and also not happy with the pace made on the port.
So, who is not happy? Frontera and CGX shareholders. Guyana Government. That's a problem for CGX and Frontera Board and Management Teams.
What would make the above stakeholders happy? A third party transaction - that would see these assets in the hands of a competent operator with deep pockets.