Cairn Energy signs West African farm down pact with ConocoPhillips
BY RAZAK MUSAH BABA
LONDON -- Cairn Energy, said 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 2,050 sq km 3D seismic survey has been used to identify prospects.
The exploration campaign is targeting a block wide potential of more than 1.5 Bbbl of yet to find resource with a proposed two well program with drilling expected to commence in first half of 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.
Dow Jones Newswires