The government of Gambia has granted approval for the farmout by FAR Ltd., Perth, of two offshore exploration blocks to Malaysian state firm Petronas.
Petronas will take a 40% interest in contiguous offshore petroleum licences A2 and A5 in return for funding 80% of the exploration well costs of the forthcoming Samo-1 wildcat on Block A2 up to a maximum of $45 million.
Petronas also will pay FAR a cash consideration of $6 million plus 80% of nonwell back costs. The proceeds are subject to reconciliation and were estimated to be $19 million (Aus.) at June 30.
FAR will retain 40% interest and operatorship status. The company originally had an 80% interest in the blocks.
FAR said last week that it had finalised a location for Samo-1 in 1,017 m of water and 112 km from the coast in the Mauritania-Senegal-Guinea-Bissau-Conakry basin.
The Samo structure has been assessed as having potential to hold a resource up to 825 million bbl of oil. It lies on trend and south of Cairn Energy Group’s SNE oil discovery in which FAR is a joint venture partner.
The well is to be drilled by the dynamic positioning drillship Stena DrillMAX.
FAR says it has also identified and mapped a second prospect called Bambo which lies in Block A2 northeast of Samo.
Exploration of this prospect will be influenced by the results of Samo-1.
