ConocoPhillips Acquires Interest in Cairn’s Blocks Offshore Senegal
- Business & Finance
Cairn announces that it has entered into a farm down agreement with ConocoPhillips for three contiguous blocks located offshore Senegal, West Africa.
Under the terms of the agreement, which is subject to Government of Senegal approval, ConocoPhillips will acquire a 25% working interest from Cairn in the three contiguous blocks – Rufisque, Sangomar and Sangomar Deep where a 2,050km2 3D seismic survey has been used to identify prospects.
The exploration campaign is targeting a block wide potential of more than 1.5 billion barrels of yet to find resource with a proposed two well programme with drilling expected to commence in H1 2014 with the Cairn contracted Cajun Express rig.
Cairn will retain operatorship and 40% interest in the blocks during the exploration phase. Petrosen, the Senegal National Oil Company, will retain a 10% interest in the exploration phase. In the event of a commercial success, ConocoPhillips would have the option to operate the future development of the resource.
The detailed financial terms of the agreement are confidential; however, ConocoPhillips will pay Cairn a payment inclusive of a portion of back costs on the blocks, along with promoted terms of future exploration expenditure.
In March 2013, Cairn farmed in to the three blocks which were previously operated by FAR Limited with Petrosen as a JV partner. The transaction added a number of drillable prospects to Cairn’s exploration inventory and drilling programme which will begin in Morocco in Q4 2013.
Simon Thomson, Chief Executive, Cairn Energy PLC said:
“Cairn is delighted to be joined in its frontier exploration programme in Senegal by ConocoPhillips. The strategic farm-out means Cairn is able to intensify its plans to explore its acreage offshore Senegal, where the gross prospective block wide resource potential is estimated to be in excess of 1.5 billion barrels. The transaction is in line with Cairn’s strategy of balancing material frontier exploration alongside sustainable levels of financial commitment.”
Press Release, August 1, 2013