Rick Wilkinson
OGJ correspondent
MELBOURNE, Sept. 29 -- Woodside Energy Ltd., Perth, and Dana Petroleum PLC, London, have entered into a comprehensive and wide-reaching heads of agreement that covers equity interests off Mauritania, Kenya, and Australia and a study area off Ghana.
The agreement allocates Dana a 6.25% interest in Mauritania's southern offshore permit, Block 2, where the new Dorade-1 wildcat is currently suspended 70 m above the target zone. Woodside, as operator, will retain a 41.5% interest in the block and intends to drill Dorade-1 into the potential reservoir section in the next two months using the Stena Tay semisubmersible (OGJ Online, Sept. 24, 2004).
In return Dana has allocated Woodside a 5% interest in the northernmost permit, Block 7, leaving Dana with 63.85%. Woodside has agreed to pay $100,000 (US) upfront and to carry Dana through its seismic and drilling obligations on Block 7 up to $1.44 million. At the end of that time Woodside has the right to exercise an option over a further 10% of Dana's interest in the permit.
Meanwhile, Dana will assign Woodside a 10% interest in each of production sharing contract areas L-5 and L-7 off Kenya in exchange for a 10% interest in four Woodside blocks in Great Australian Bight deepwater acreage off South Australia (EPPs 28, 29, 30, and 31).
Woodside drilled its first well, Gnarlyknots-1A, in the Great Australian Bight last year. Projected to 5,600 m, it went to TD 4,736 m in 1,315 m of water on EPP 29.
Although plugged and abandoned without encountering commercial hydrocarbons, sufficient geological data was obtained to sustain interest and potential in this largely untouched Australian province. The well reached its primary objective but was plugged due to prolonged adverse weather before reaching a deeper secondary target.
A third African tie-up between the two companies involves Woodside participating in a study of the Western Tano basin off Ghana. Woodside has an option to acquire 50% of Dana's interest in this area once the study is complete, subject to discussions with the Ghanaian government to extend the permit term to allow further deepwater exploration.
A final part of the agreement provides for Woodside to drill Dana's planned Petrel-1 wildcat on Mauritania Block 1, in which Woodside has no equity.
The total deal is subject to numerous government, regulatory, and joint venture approvals as well as the completion of due diligence and the completion of negotiation of agreements in Ghana.
