CGX Energy, Frontera See Guyana Petroleum Prospecting License Terminated

CGX Energy (TSXV: OYL) and Frontera Energy (TSX: FEC) are officially out of an asset in Guyana. The two corporations this morning indicated that a second letter has been received from the Government of Guyana related to the Corentyne petroleum prospecting block off the coast of the country.

The letter essentially states that the prospecting license associated with the Corentyne block has been terminated. While the full letter was not provided by either company, it purportedly states, “The Government is of the view that the Petroleum Agreement and Prospecting Licence are at an end. [..] [The Government] hereby terminates the Petroleum Agreement and cancels the Prospecting Licence with immediate effect.”

The termination follows the issuance of a letter by the Guyanese government in early February stating that the license was terminated and in the event that it was determined it was not terminated, it served as a 30-day notice of the intent to cancel the license. That 30-day period has now lapsed, leading to the definitive cancellation.

Both CGX and Frontera for their part however dispute that the license has been cancelled, stating that the joint venture between the two parties “remains firmly of the view that its interest in, and the License for, the Corentyne block remain in place and in good standing.” The two parties are calling for the Guyanese government to “amicably resolve” the issues surrounding the license, and that they are prepared to go down legal paths.

CGX Energy last traded at $0.14 on the TSX Venture.

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Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.