Australian oil and gas company FAR said that its subsidiary FAR Gambia has secured the Gambian government approval for the transfer of a stake of 40% in Blocks A2 and A5 in offshore Gambia to a subsidiary of Malaysia’s Petroliam Nasional Berhad (PETRONAS).
Image: The Gambian government approves Far, PETRONAS farm-out arrangement for two offshore Gambia blocks. Photo:courtesy of suwatpo/Freedigitalphotos.net.
FAR and PETRONAS signed a farm-out agreement in February under which the Malaysian national oil company would bear 80% of the exploration well costs of the Samo-1 exploration well up to a maximum $45.0m. Apart from that PETRONAS will pay the Australian company $6m and 80% of non-well back costs.
The A2 and A5 blocks are spread over an area of around 2,682km2 within the Mauritania-Senegal-Guinea-Bissau Conakry Basin and are contained in water depths ranging from 50 to 1,200m.
According to FAR, the two offshore Gambian blocks are near to and on trend with its SNE oil field discovery and have significant exploration potential.
FAR’s managing director Cath Norman said: “By securing the approval of The Gambian Ministry of Petroleum and Energy, FAR has achieved another milestone towards its objective of drilling the substantial oil resource potential of the highly prospective Blocks A2 and A5 in The Gambia.”
The Australian oil and gas company will retain a stake of 40% and operatorship through the exploration stage of the two offshore Gambian blocks. PETRONAS, on the other hand, which will own a stake of 40% in the two licenses, will have a right to become the operator for their development.
The Samo-1 well is scheduled to be drilled in late 2018. In this connection, FAR had given a contract to a Stena Drilling subsidiary to provide and operate the Stena DrillMAX drillship.
The Samo prospect is estimated to hold prospective resources of 825mmbbls oil while the Samo-1 well will be the first exploration well to be drilled offshore Gambia since 1979.
Apart from the Samo prospect, FAR had marked Bambo to be another drillable prospect in the two Gambian blocks.