Cairn Energy PLC will take a farmout from an Australian company and become operator of three exploratory blocks offshore Senegal.
Cairn Energy will take a 65% working interest in the contiguous Rufisque, Sangomar, and Sangomar Deep blocks on which a number of drillable prospects have been developed.
The farmor, FAR Ltd., Melbourne, retains 25% working interest, and Senegal’s state Petrosen has 10% carried. FAR Ltd. said a well could be drilled as early as 2014.
Cairn is to fully fund the 100% costs of one exploratory well to an investment cap. Thereafter exploration costs will be apportioned Cairn 72.2% and FAR 27.8%, and Petrosen is carried. As part of the transaction, Cairn will also pay 72.2% of the $10 million in costs FAR has incurred on the blocks.
The working and paying interests for any development will be Cairn 59.2%, FAR 22.8%, and Petrosen 18%. Cairn will retain certain preferential rights should FAR wish to farm down further equity later.
The three blocks total 7,490 sq km from near shore to deep water over the shelf, slope, and basin floor of the Senegalese part of the productive Mauritania-Senegal-Guinea-Bissau basin. The acreage is covered by a 2,050 sq km of 3D seismic survey, and a number of play types, leads, and prospects have been identified.exp