Woodside backs out of Rabat Deep operatorship (Morocco)

  • Business & Finance

Chariot Oil has announced that Woodside, its partner in the Rabat Deep permit, offshore Morocco, has not elected to take operatorship and fund the drilling of an exploration well in return for an additional 25% equity stake.

As a result, Chariot will remain operator with a 50% equity interest, with Woodside retaining a 25% equity interest and the Office National des Hydrocarbures et des Mines (ONHYM) a 25% carried interest.

To remind, Chariot Oil signed a farm-out agreement with Woodside for initial 25% participating interest in the Rabat Deep Offshore permits I-VI. The agreement included an option to acquire an additional 25% and operatorship in these permits for a capped well carry obligation.

As part of its two-tier partnering process, Chariot is currently at near zero cost in its Moroccan acreage and will seek an additional partner to participate in drilling on the Rabat Deep permits.

JP-1 is the focus prospect and contains 618mmbbls of gross mean prospective resources as estimated by Netherland Sewell and Associates on the 2D seismic data. According to Chariot, this prospect remains technically robust on the 3D seismic and a Competent Person Report will be undertaken following the interpretation of the recently received pre-stack depth migrated data. Whilst market conditions are challenging, the large scale of the prospects in Chariot’s portfolio means that drilling success would create transformational value even at current oil prices, the company said in its press release.

A dataroom for Rabat Deep will open in due course and, subject to securing a partner, drilling of this prospect is now anticipated to occur in late 2016/2017, Chariot added.

Loukos and Mohammedia

The interpretation of the pre-stack time migrated 3D data acquired in the 2014 seismic campaign has also generated several material prospects within the Loukos and Mohammedia licences, offshore Morocco, including the JP-2 prospect in the Jurassic play. According to Chariot, recent work has also identified further oil-prone prospectivity within the Neogene. Partners will be sought for these licences to either participate in the drilling of the prospects already located, or to further the 3D seismic campaign across the permits. A dataroom will be opened once the Chariot team is satisfied that it has a full description of the prospectivity within the licences to maximise the understanding of the value proposition for potential farminees, Chariot said.

An independent audit of the prospective resources associated with the 1,700km2 3D seismic campaign on these permits will also be carried out once Chariot has completed its internal evaluation of the pre-stack depth migrated data.

Larry Bottomley, Chief Executive of Chariot, said: “It is disappointing that Woodside has not exercised its option, but we remain optimistic regarding the potential of the Rabat Deep permits and particularly that offered by the JP-1 prospect.

“These are challenging times for oil and gas companies and investment decisions are being affected as a result. As mentioned previously, partnering is tougher, but we also believe that this climate can be an opportunity for those who are looking to take advantage of high potential assets, such as those within our portfolio. Whilst the nature of the market is cyclical, the prospectivity that we see within our licences remains transformational and Chariot’s strong cash position will enable us to take advantage of opportunities to further enhance our asset base.

“We look forward to continuing to work with Woodside and ONHYM on the development of the Rabat Deep permits.”

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