PA Resources buys 35% Azurite Marine field stake

April 22, 2008
PA Resources AB has acquired a 35% interest in exploration license Mer Profond Sud and Azurite Marine field in Congo (Brazzaville) from Murphy West Africa Ltd. (OGJ, Oct. 12, 2007, Newsletter).

Uchenna Izundu
International Editor

LONDON, Apr. 22 -- PA Resources AB has acquired a 35% interest in exploration license Mer Profond Sud and Azurite Marine field in Congo (Brazzaville) from Murphy West Africa Ltd. (OGJ, Oct. 12, 2007, Newsletter).

The $133 million deal adds recoverable reserves of 26 million bbl of oil to PA Resources' portfolio, with initial oil deliveries from Azurite scheduled for second-quarter 2009. Azurite, which holds an estimated 75 million bbl gross of oil reserves, is expected to peak at 40,000 b/d of oil gross.

Appraisal well AZRM-2ST1, which was sidetracked, tested 7,893 b/d of oil and 4.63 MMscfd of natural gas.

The field will be developed from subsea wells, using a spread-moored, floating, drilling, production, storage, and offloading vessel.

The Mer Profond Sud ermit is in the prolific Lower Congo basin adjacent to Angola's deepwater Block 14 and the Haute Mer permit in the Republic of Congo.

PA Resources also will pick up a 35% stake in a 3,500 sq km exploration block within the license, with 19 undrilled prospects and identified leads. "Four of these have been matured to drill-ready status, with additional resources associated with a large exploration portfolio," the company added.

The parties agreed that PA Resources would spend $110 million on the deal and pay $23 million for two exploration wells. The companies will adjust the price depending on performance 1 year after production starts.

PA Resources said financial consolidation of the assets would take place "from the beginning of the second quarter 2008."

Murphy West Africa Ltd., a unit of Murphy Oil Corp., will operate the permit and Azurite field with a 50% stake. The other partner is SNPC with a 15% participating interest.

Contact Uchenna Izundu at [email protected].