Kaieteur Block – Ratio Petroleum Update

Westmount Energy Limited

27 September 2023

 

27^th September 2023

WESTMOUNT ENERGY LIMITED

("Westmount" or the "Company")

Kaieteur Block - Ratio Petroleum Update

Westmount Energy Limited (UK AIM: WTE.L, USA OTCQB: WMELF), the AIM-quoted oil and gas investing company focussed on high impact drilling outcomes in emerging basins, notes the announcenment today by Ratio Petroleum Energy Limited Partnership ("Ratio Petroleum"), that ExxonMobil has now decided not to commit to drilling a second well on the Kaieteur Block¹ and that both ExxonMobil and Hess Corporation have elected to withdraw from the Kaieteur Block and return their  participating interests to the original Kaieteur Licence holders Ratio Guyana Limited and Cataleya Energy Limited. The parties will now seek government approval to reassign the participating interests, so that Ratio Guyana Limited and Cataleya Energy Limited will each retain a 50% participating interest, and appoint Ratio Guyana Limited as the operator of the block. .

The current Kaieteur Block participating interests are as follows:

Esso Exploration and Production Guyana Limited 35% (operator)

Ratio Guyana Limited 25%

Cataleya Energy Limited 20%

Hess Guyana (Block B) Exploration Limited 20%

After reassignment of the participating interests the revised Kaieteur Block interests will be as follows:

Ratio Guyana Limited 50% (operator)

Cataleya Energy Limited 50%

It is also noted that the announcement by Ratio Petroleum states that under the terms of the Kaieteur Petroleum Agreement, and upon submission of an application to enter the second extension period², the participating interests on the block will have until February 2025 to commit to drilling a well. Furthermore, it is noted, that Ratio Petroleum is seeking a farm-down of participating interests and operatorship and, in this context, is already in discussions with major oil companies with a view to bringing a new entrant or entrants to the block.     

In this regard, it is also of note that the two deepwater blocks (D1 & D2), immediately adjacent to the Kaieteur block, have been the subject of at least one application during the recent Guyanese Bid Round³ which offered acreage under less benign fiscal terms than the original Kaieteur Block terms. 

In 2020, the first well drilled on the Kaieteur block, Tanager-1, evaluated a number of plays - encountering 16 metres of net oil pay (20^oAPI oil) in high-quality sandstone reservoirs of Maastrichtian age and confirming the extension of the Cretaceous petroleum system and the Liza play fairway outboard from the prolific discoveries on the neighbouring ExxonMobil operated Stabroek Block. The well was reported as an oil discovery which is currently considered to be noncommercial as a standalone development. Tanager-1 also encountered high quality reservoirs in deeper Santonian and Turonian plays though interpretation of the reservoir fluids in these intervals was reported to be equivocal and requirefurther analysis.

A post-well Netherland, Sewell & Associates Inc. ("NSAI") published CPR⁴ indicates that the Tanager-1 Maastrichtian discovery contains a 'Best Estimate' Unrisked Gross (2C) Contingent Oil Resource of 65.3 MMBBLs (Low to High Estimates 17.7 MMBBLs to 131 MMBBLs) - with a 'Best Estimate' Unrisked Net (2C) Contingent Oil Resource attributable to the Kaieteur Block of 42.7 MMBBLs (Low to High Estimates 11.3 MMBBLs to 86 MMBBLs).

Westmount holds approximately 5.26% of the issued share capital of Cataleya Energy Corporation⁵, the parent company of CEL and circa 0.04% of the issued share capital of Ratio Petroleum the ultimate holding entity with respect to Ratio Guyana Limited.

¹Previous announcements by Ratio Petroleum indicate that, under a farm-in agreement executed with ExxonMobil in 2016, the original Kaieteur 2nd well prospect nomination date was 22nd August 2021, with any drilling consequent to this decision to commence within nine months of the nomination date. The prospect nomination date was subsequently extended twice by agreement to 22^nd March 2022 and again to the 2^nd October 2023.

²The Kaieteur Petroleum Agreement is currently in the first extension period, which began on February 2, 2021 and lasts for 3 years.

³https://oilnow.gy/featured/ali-jagdeo-see-guyana-oil-bid-responses-as-favourable-given-governments-terms/

⁴CPR by Netherland, Sewell & Associates Inc. ("NSAI") 14 February 2021- published by Ratio

Petroleum

⁵Based upon number of shares in issue at 6^th January 2023

For further information, please contact:

Westmount Energy Limited                              www.westmountenergy.com

David King, Director                                          Tel: [phone]

email: [e-mail]

Cavendish Securities plc (Nomad and Broker)   Tel: [phone]

Neil McDonald/Peter Lynch (Corporate Finance)

 

END