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Tullow hits oil in Guyana wildcat

Offshore find believed to be larger than pre-drill estimates

Anglo-Irish operator Tullow Oil has made an oil discovery with a wildcat on the Orinduik licence offshore Guyana.

Tullow confirmed Monday the Jethro-1 well had reached a depth of 4400 metres and intersected 55 metres of net oil pay, with logs confirming high quality oil bearing sandstone reservoirs of Lower Tertiary age.

It added that the results from the well supported a recoverable oil resource estimate higher than its pre-drill forecast.

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"This substantial and high value oil discovery in Guyana is an outcome of the significant technical and commercial focus which has underpinned the reset of our exploration portfolio,” Tullow chief executive Paul McDade said.

“It is an excellent start to our drilling campaign in the highly prolific Guyana oil province. We look forward to drilling both the Joe and Carapa prospects in our 2019 drilling campaign and the material follow-up exploration potential in both the Orinduik and Kanuku licences."

Jethro-1 was drilled in water depth of 1350 metres using the drillship Stena Forth and will now be followed by a well on the Joe prospect which is expected to spud at the end of the month, targeting an estimated 150 million barrels in gross prospective resources.

Tullow said the results from Jethro-1 had significantly de-risked other Tertiary age prospects on the Orinduik licence, including Joe.

Further prospects at Orinduik include Kumaka, Amaila, Aurituk, Amatuk, Rappu, Tuktuk, Drios, Blacktip, Mako and Iatuk.

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Tullow operates the Orinduik lcence with a 60% stake on behalf of partners Total and Eco (Atlantic) Oil & Gas which hold a 25% and 15% interest, respectively.

Analysts at UK bank Barclays said in a market note after the discovery was revealed: "The result is potentially transformational for Tullow, exceeding management's more-than 100 million barrel pre-drill resource estimate for Jethro and de-risking other Tertiary age prospects identified within its licence area.

"Jethro has been a high-profile well ... and we believe this successful outcome is likely to encourage the market to look beyond the discovered resource at Jethro and begin to de-risk the possibility of multiple commercial discoveries across Tullow's Guyana acreage."

Analysts at BMO Capital Markets added: "Jethro is a sandstone stratigraphic trap in the northeastern part of Orinduik block that based on several seismic attributes is analogous to the Hammerhead discovery nearby." Hammerhead is one of ExxonMobil's discoveries on the adjacent Stabroek block.

"This (Jethro) discovery should de-risk other Tertiary age prospects on the Orinduik licence, including the shallower Upper Tertiary Joe prospect ... which will commence drilling later this month.

"Tullow has also identified potential upside in Jethro channel."

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