Kosmos withdraws from Porcupine Basin

Kosmos Energy Ireland (Kosmos) intends to withdraw from three licences located in the Porcupine Basin, offshore Ireland’s west coast. 

Namely, Antrim Energy’s subsidiary, Antrim Exploration (Ireland) Limited, has received notice from Kosmos revealing its intent to withdraw from the Frontier Exploration Licence (FEL) 1/13 in which Kosmos has 75% interest, and Antrim 25%.

Kosmos had previously acquired 75% interest and operatorship in FEL 1/13 in 2013 in exchange for carrying the full costs of the 3D seismic programme and re-imbursement to Antrim of a portion of the past exploration costs incurred on the blocks. According to Antrim, the initial three year term of the FEL expires in early July 2016 and has to date involved the acquisition of 3D seismic over the FEL area, followed by seismic processing, interpretation and geological studies.

Anthony Potter, Antrim’s CEO said: “While we are disappointed with Kosmos decision not to continue, their decision to exit the Porcupine Basin should be considered in the broader context of their portfolio and markets. Several exciting prospects and leads have previously been identified on FEL 1/13 and despite volatile commodity markets and investment sentiment moving away from exploration we remain optimistic that FEL 1/13 would be an attractive addition to the right exploration portfolio.”

Europa Oil & Gas eyes two

Furthermore, Europa Oil & Gas, an AIM quoted oil and gas company with producing and exploration assets in Europe, announced its intent to assume 100% interest in licences FEL 2/13 and 3/13, as a follow up to Kosmos’ announcement to withdraw from the Joint Operating Agreements for both of those licences.

The board of Europa Oil & Gas has said that, given the record number of applications in Ireland’s 2015 Atlantic Margin Round, closed on September 16, 2015, it believed there would be interest in partnering for the both licences. The Irish Authorities have reported they have received 43 applications from major, mid cap and small companies, the largest number of applications ever received in any Irish offshore licensing round.

Europa’s CEO, Hugh Mackay, said: “Whilst we are disappointed that Kosmos has elected to withdraw from Ireland we appreciate the necessity for portfolio rationalisation in the current business environment and their decision brings opportunity to Europa. Drilling costs have already fallen substantially: day rates for rigs capable of drilling in the Atlantic Margin have reduced from $600,000 per day to $300,000 per day or less. We anticipate that the 2015 licensing round will bring new entrants into the basin including major and mid-cap oil companies. We are very confident in our technical and commercial work and look forward to updating the market as we take these licences forward.”

Kosmos will remain operator during the period of its withdrawal from the contract and Joint Operating Agreement.

Offshore Energy Today Staff

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