CGX Energy Inc. has announced that the Government of Guyana has approved the transfer of Century Guyana Ltd.'s 100% interest in the Pomeroon Prospecting license offshore Guyana to CGX 's wholly owned subsidiary, CGX Resources Inc.
The Pomeroon license is 11,254 sq km and is adjacent to CGX's 100% owned Annex portion of the Corentyne license. Water depths in the Pomeroon license range from 20 to 170 m. The Government of Guyana Pomeroon also extended the Petroleum Prospecting License to Nov. 19, 2009. During the first phase of the First Renewal period terminating May 19, 2005, CGX's work commitment includes reprocessing 330 km of the 6,000 km that have been shot on the license, and re-interpreting and integrating regional geological, aeromagnetic, gravity, and seep surveys. If CGX elects to renew the license at the end of the first phase, subsequent work would include new seismic surveys and/or drilling exploration wells. If CGX makes a a significant discovery, that portion of the license will be converted to a 25 yr Production License.
All conditions precedent to the Purchase and Sale Agreement previously announced on Nov. 13, 2003 have now been satisfied. The terms of the acquisition are that in return for a 100% interest in the Pomeroon license, CGX has agreed to pay to Century Guyana Ltd. $150,000 and 2 million common shares of CGX, the issuance of which remains subject to regulatory approval.
With this acquisition, CGX now holds an interest in 9.8 million acres both onshore and offshore in Guyana. CGX also announced that the Government of Guyana extended the term of the original Corentyne license to June 24, 2011.