By Kemol King and Marianna Parraga

GEORGETOWN/HOUSTON, Dec 12 (Reuters) - Toronto-listed

Frontera Energy ( FECCF ) and partner CGX Energy ( CGXEF ) are

seeking alternatives to resolve a dispute with Guyana over

rights to retain an offshore block where they found oil, but

should they fail to reach an agreement, the matter is set to go

to an arbitration court, the vice president said.

Guyanese Vice President Bharrat Jagdeo said in August the

government had opted not to approve the companies' application

to appraise a discovery in the block, which would have given

them more time with the license, as the South American nation

was not confident the firms could find a financial partner.

On Thursday, Jagdeo said there was no doubt Frontera and CGX

failed to comply with some terms of the license, but if they

have a different interpretation, the parties can go through the

legal process established in the agreement.

"We are not worried about it going to court," he told

reporters in a press conference.

According to the agreement's terms, if parties do not

resolve a dispute in a 60-day period after the joint venture's

partners notify the government of the disagreement, they can go

to arbitration or a sole expert.

Frontera and CGX Energy ( CGXEF ) said earlier on Thursday they were

"firmly of the view that the Corentyne block Petroleum Agreement

remains in place."

"The joint venture ... has sent the government of Guyana a

letter activating a 60-day period for the parties to the

Corentyne block Petroleum Agreement to make all reasonable

efforts to amicably resolve all disputes via negotiation," they

added in the release.

Jagdeo said he had not seen the letter.

Analysts and experts were expecting Corentyne to be the next

area to be developed in Guyana, which could have added diversity

to an industry completely dominated by a consortium led by U.S.

major ExxonMobil ( XOM ).

Corentyne is the only area Frontera and CGX have left in

Guyana, after returning two other blocks to the state, Demerara

and Berbice. In 2022, the companies announced the presence of

light oil and gas condensate in Corentyne and have focused their

efforts there since.

A CGX subsidiary has a separate project in Guyana for a $130

million port, which is starting commercial operations this month

after the company negotiated long-term agreements for its use,

it said. The port can accommodate vessels of up to 150 meters

(492 feet) long.