Cairn Energy PLC will take a farmout from Chariot Oil & Gas Investments (Mauritania) Ltd. to earn a 35% nonoperated interest in the C19 exploration block offshore Mauritania.
The block covers 12,175 sq km in water depths ranging from shallow shelf to more than 2,000 m. It lies north of existing discoveries in Mauritania and contains the Tertiary and Cretaceous deepwater fan plays proven farther south along the West African margin.
The most prospective part of the block is covered by 3,500 sq km of 3D seismic recently acquired by Chariot and still being processed. The seismic will be interpreted with the objective of identifying a high grade drillable prospect by the end of first-quarter 2014.
The block is currently held by operator Chariot 90% and the Mauritania’s state Ste. Mauritanienne des Hydrocarbures 10%.
The farmout, subject to government approval, calls for Cairn to pay Chariot $26 million for seismic and other back costs. Thereafter, exploration costs will be apportioned Cairn 38.89% (35% working Interest), Chariot 61.11% (55% working interest), and SMH 10% working interest.
If before the end of the first phase of the license on June 15, 2015, Cairn were to increase its interest to greater than 50%, Chariot will support Cairn’s application for operatorship of the block.
Cairn Energy has an existing Atlantic margin portfolio in Senegal and Morocco.