Apache Corp. and Total said on Tuesday they made a major oil discovery offshore Suriname with the closely watched Maka-Central 1 well.
Apache's exploration offshore Suriname has been on the radar as it is just over the border from an Exxon Mobil-led consortium's giant fields off Guyana, which are estimated to hold more than 6 billion barrels of oil.
The Make-Central 1 well confirmed a geologic model with 73 meters (240 feet) of oil pay and 50 meters (164 feet) of light oil and gas condensate pay, and more appraisal planning was underway, Apache said in a statement.
"This appears to be a significant discovery and should be viewed very positively," RBC Capital Markets analyst Scott Hanold said.
Apache's shares rose 14.6% to $29.39 in premarket trading.
The independent U.S. oil producer's agreement with Total SA for joint development offshore Suriname included a $100 million payment at the outset, and additional pay for expenses recorded in the exploration.
Suriname was considered a long-shot for Apache, which had largely focused on a venture in a remote corner of the Permian Shale basin, the top U.S. shale formation.
However, that area has required enormous infrastructure investments and delivered mostly natural gas at a time when prices for the fuel are at their lowest in more than two decades. Apache has pledged to spend 20% less this year on capital outlays than in 2019.
"We are very pleased with results from Maka Central-1. The well proves a working hydrocarbon system in the first two play types within Block 58 and confirms our geologic model with oil and condensate in shallower zones and oil in deeper zones," said Apache Chief Executive Officer and President John J. Christmann.