Borr Drilling jack-up rig going to work off Cameroon
UK-based oil and gas company Tower Resources has hired a jack-up rig from Borr Drilling, an offshore drilling contractor, for its drilling campaign offshore Cameroon.
Tower Resources has executed a contract with Borr Drilling for the Norve jack-up rig to drill the NJOM-3 well on the Thali license offshore Cameroon in 2024. The rig is currently busy with existing contracts to deliver a series of wells, whose timing is naturally subject to operational uncertainty.
Following the completion of those wells, the rig is expected to be available in Cameroon between April and August 2024. Subject to the rig availability, Tower anticipates that the NJOM-3 well will be spudded in 2Q or possibly 3Q 2024. The start date range will be narrowed further as it draws nearer.
According to the company, the contract is subject to conditions precedent concerning the final documentation of its Thali license extension, and prepayment of a portion of the expected rig hire. While the exact day rate was not disclosed, the firm did confirm that the contracted day rate for the rig was in line with the company’s latest cost projections.
The 2011-built Norve jack-up rig, which was constructed at the PPL shipyard in Singapore, is capable of operating in water depths of up to 400 ft. With a maximum drilling depth of 30,000 ft, the rig is of PPL Pacific Class 400 design and can accommodate 150 people.
Jeremy Asher, Tower Resources Chairman & CEO, commented: “Signing the rig contract is a significant step forward in the development of our Cameroon assets and moves us toward spudding the NJOM-3 well in 2024. The Norve rig was chosen both for its high specification and its anticipated window of availability.
“Our next steps will be to finalize the documentation of the Thali license extension with the Ministry of Mines, Industry and Technological Development (MINMIDT), and to move our farm-out discussions with multiple parties towards a conclusion, we hope during the first quarter of 2024. As we have explained in the past, our plan is to fund the well primarily with asset-level financing, and we still believe that is realistic.”
Taking steps to raise around £600,000
Tower Resources has put the wheels into motion to raise gross proceeds of approximately £600,000 (about $759,540) through subscriptions for approximately 3,000,000,000 ordinary shares of 0.001p each for 0.02p per subscription share, representing a discount of around 13% to the closing bid price of the shares on December 15, 2023.
The company explains that this proposed subscription is being made to fund working capital and work program commitments in all three of the firm’s licenses over the coming months, while the documentation of its license extension in Cameroon and current farm-out discussions are concluded.
“While we finalize the farm-out discussions, we have chosen to raise a small amount of capital of which I am investing £80,000. We envisage that the majority of the remaining well cost will come from asset-level financing. I have chosen to participate in this fundraising myself, as I have in several of our previous recent fundraisings, reflecting my personal commitment to this project and my confidence in its success,” added Asher.
The Thali PSC covers an area of 119.2 km2, with water depths ranging from 8 to 48 meters, in the Rio del Rey basin, in the eastern part of the Niger Delta. The NJOM-3 drilling was previously set for June 2020, however, Tower Resources declared force majeure in March 2020 in respect of the first exploration period on the Thali license due to Covid-19 restrictions.
In March 2021, the president of the Republic of Cameroon approved a further extension of the first exploration period of the Thali license. The company shortly after signed an agreement to farm out a 49% non-operating working interest in its Thali PSC to Beluga Energy.
Meanwhile, Tower Resources recently undertook a basin and thermal maturity study within its operated license PEL 96 in Namibia, significantly enhancing its understanding of the hydrocarbon prospectivity of the license.