Guyana gives Frontera and CGX Energy 30 days notice to cancel their Corentyne license

The Canadian energy companies reported that the Guyana government has given CGX Energy a 30-day warning to cancel the joint venture license of the Corentyne Block.

The South American nation expressed earlier a lack confidence that the companies would be able to secure a partner for their project.

In a letter, the government stated that it would cancel the petroleum agreement and license with the joint-venture. It also said that there were no "reasonable" grounds to extend the period.

The letter also asked that the joint venture submit any representations before February 22, so the government can reconsider its decision.

The letter stated that the license would cease to be valid on March 10 unless the government acted favorably.

Exxon Mobil is the leader of Guyana's oil sector. The development of the Corentyne Field was an attempt to reduce the dependence on this U.S. company.

Frontera and CGX returned to Guyana two blocks earlier, but this is the only block they have left.

Frontera and CGX Energy confirmed that their licenses for the Corentyne Block remain in effect and the petroleum agreement has not been terminated.

They said that "despite the above, the joint-venture is evaluating all legal options it has to assert its right and will respond to Government."

(source: Reuters)