(Reuters) – Oil producer Apache Corp and its joint venture partner Total SA said on Wednesday they made their third oil discovery offshore Suriname, sending Apache’s shares up 14% in after-market trading.
The Suriname discovery, dubbed “among the most anticipated in the world” by one brokerage, is seen as central to Apache’s efforts to reduce its reliance on the Alpine High venture in Texas’ Permian basin, which has suffered from diving natural gas prices.
The third discovery also comes at a time when oil and gas producers across the globe are reeling under a coronavirus-led decline in energy demand that led crude prices to drop below $0 for the first time ever.
“This is the best well we’ve drilled in the basin to date, with the highest net pay in the best quality reservoirs,” Apache Chief Executive Officer John Christmann said.
The third major find was at the Kwaskwasi-1 well drilled offshore Suriname in Block 58, which comprises 1.4 million acres.
Once operations at Kwaskwasi-1 are completed, the drilling ship will move to the fourth prospect in Block 58, Keskesi, Apache said.
Apache did not provide any estimates for recoverable oil and gas.
The Suriname operations are just across the border from where Exxon Mobil led discoveries off Guyana that are estimated to hold more than 8 billion barrels of oil.
Former Suriname President Desi Bouterse described the discovery as a “great gift,” saying “this will be a lot of money for this small country.”
Apache and Total each hold a 50% working interest in Block 58, with the U.S. producer as the operator.
(This story corrects Bouterse’s title to former president in ninth paragraph, spelling error in third paragraph)
Reporting by Arathy S Nair in Bengaluru;; Editing by Maju Samuel and Shailesh Kuber