All articles in the Farm in, Farm Out Section:


TOTAL Expands Portfolio In Algeria

ALGERIA: TOTAL and partner Partex have been awarded a 49% interest in the Ahnet license, as part of the second bid round held by the Algerian National Oil and Gas Development Agency (ALNAFT).

Located near In Salah in southwestern Algeria, the Ahnet exploration and development acreage covers an area of 17,358 square kilometers in which twelve natural gas formations have already been discovered.

TOTAL holds a 47% interest and will appraise and develop the Ahnet finds with partners Partex (2%) and Sonatrach (51%).

A development plan will be submitted for approval before mid 2011, with first gas scheduled for 2015. The Ahnet license contains significant reserves (approximately 500 billion cubic meters of gas) which should produce at least 4 billion cubic meters a year, as per the contract with Sonatrach.

This latest project is a developmental milestone in the new southwestern Algeria gas province, which is also home to the Timimoun project operated by the consortium Sonatrach, TOTAL and Cepsa.

It further cements TOTAL’s commitment to investing in Algeria in both the natural gas upstream and petrochemicals.

TOTAL’s production in Algeria comes from direct interests in the Tin Fouyé Tabenkort gas field, and from the Group’s 48.83% stake in CEPSA, which is partnered with Sonatrach on the Ourhoud and Rhourde El Krouf  fields.


THOSE WHO ARE BUYING

GUINEA

Dana Farms In To Guinean Block UK based Dana Petroleum and US Independent Hyperdynamics Corp. have signed an exclusive letter of intent (LOT) for Dana to gain an interest in the Texas company’s 80,000 sq km concession offshore the Republic of Guinea.

The LOI positions Dana to potentially acquire a 23% working interest in the large concession which encompasses all of offshore Guinea, an area equivalent to 330 UK blocks.

The LOI contemplates Dana and Hyperdynamics signing definitive binding documents no later than December 31, 2009. During this period, Hyperdynamics is legally committed to deal exclusively with Dana with respect to this 23% interest.

Hyperdynamics intends to bring in to the concession a further significant partner with strong financial and technical capability. Dana has the option to negotiate for an additional interest of up to a further 27% (to give Dana a total of 50% interest) if Hyperdynamics does not sign a letter of intent with another potential partner by November 30, 2009.

Hyperdynamics first officially announced its intent to farm-out a portion of its Guinea acreage in January 2007. Since that time the company has opened up its Houston data room and made presentations in numerous venues including Calgary and Houston, and retained the services of advisors such Zeus Development Corp. to assist in attracting potential farm-in partners.

Hyperdynamics has recently signed a new MoU with the government of Guinea which confirms Hyperdynamics’ title to the Production Sharing Contract (PSC). It requires relinquishment of 64% of the current acreage by end 2009 and a review of the existing PSC by end March 2010.

GHANA

Ghana Is Angry At ExxonMobil, Ghana’s petroleum authorities are dissatisfied with the ways and means by which ExxonMobil, the world’s largest corporation, is trying to gain a foothold in the continent’s newest offshore exploranon play. Kosmos confirmed it had entered into an agreement with ExxonMobil but the Ghanaian government has said that the agreement is illegal and will not honor it.

“We have formally notified (Kosmos) that we do not recognize whatever agreement they reached with ExxonMobil – we told them we disapprove of it because it’s illegal,” a GNPC source was quoted as saying last week. The source said Kosmos had violated Ghanaian laws when it shared confidential exploration data with over 20 companies for its own commercial purposes without giving GNPC any prior notification.

…Wants To Buy Kosmos Jubilee Stake

Ghana National Petroleum Corp. has the funds to buy a stake in the Jubilee oil field from Kosmos Energy LLC, according to Kwame Ntow Amoah, head of economic evaluation and monitoring at the state-hydrocarbon company.

Ghana National, also known as GNPC, is in talks with Kosmos about the price and other issues and has secured the money from “at least two” banks, he said today by mobile phone from Accra. He declined to name the lenders or comment on the price.

GNPC will consider proposals from potential partners once the purchase is complete. he said. “The Chinese, the Americans, the British, all of them are welcome to bring proposals and we will look at them at the second stage,” Amoah said. GNPC could choose one company to work with or a combination of partners, he said, adding that there isn’t a date by which a decision on the sale must be made.

Ghana’s nascent oil industry, still a year away from production of oil for export, has attracted attention from some of the world’s top energy companies. British Petroleum too has been counted as one of those interested in Kosmos’ stake in Jubilee. In early October 2009, Kosmos said it had agreed to sell its Ghanaian assets, including its 23.49 percent stake in Jubilee, to Exxon Mobil Corp. for $4 billion. Ghana’s government disapproves of the agreement and is still in negotiations with Kosmos. Reserves estimates of Jubilee he has been said to range from 750MMBO to 2Billion by all sorts of analysts. GNPC already has a 13.75 percent stake in the field.


Nilepet May Be Fully Established After 2011

Southern Sudan, which has a semi-autonomous government now, will vote in 2011 on whither to remain united with the rest of the country or to establish its own independent state In accordance with a peace deal signed in 2005,. If southerners vote for the independence Nilepet would be southern Sudan national company. Currently, Sudapet, the state hydrocarbon company run from the central capital in Khartoum, undertakes the training of Nilepet staff.


Addax Buys More In Gryphon

GABON Swiss independent Addax Petroleum, has acquired an additional 18.75% interest in the Gryphon Marin license area, bringing its total interest in the license area to 68.75%, prior to third party back-in options. Addax Petroleum is the operator of the Gryphon Marin license area, which covers a gross area of approximately 2,409,200 acres (9,750 km2) and lies immediately west of the Iris Marin and Ibekelia license areas, and immediately north of the Corporation’s Etame Marin license, offshore Gabon.

Addax plans to commence exploration activities on the acreage with the spudding of the Ajomba North and Pompano North prospect wells during the first half of 2009, a company release said. Addax Petroleum holds a 5 1.33% interest in the Iris Marin license area and a 31.36% interest in the Etame Marin license area. The Gryphon Marin license area is in an exploration period ending in November 2009 and carries a commitment to drill two wells. Addax Petroleum has budgeted to drill the Ajomba North and Pompano North prospects in the Gryphon Marin license area in the first half of 2009.


Algerian Bid Round Is A Tssst

American companies stay out of the race

Algeria’s 7th bid round didn’t turn out to be the big bang that the energy press had expected. As it happened, only four bids were received and four awards made. They all went to European companies: OAO Gazprom, Eni SpA, BG Group Plc, and E.ON AG.

At the first announcement in July 2008, more than 50 international companies expressed interest in bidding and numerous firms were pre-approved as operators. Somewhat surprisingly.

However, with the recent economic downturn the actual bidders were few. According to Chakib Khelil, Algeria’s Petroleum Minister, only four of the 16 blocks on offer received bids.

The four licenses went to Russian, European, and UK firms including Russian gas giant Gazprom, who was awarded the El Assel license. BG Group plc won the Guern El Guessa license. Italy’s Eni was awarded an exploration license in Kerza, while E.ON AG’s Ruhrgaz won the Rhourde Yacoub permit.

The 7th international bid round was the first to be held under a 2006 law that gives state parastatal Sonatrach at least a 51% share in every oil and gas exploration contract with foreign partners. This, in addition to the current economic crisis which has E&P company shares trading at a huge disadvantage, and the difficulty in accessing capital, could all have contributed to the low level of participation.

Khelil said the government planned to launch another round in 2010 to award those zones included in the 7th exploration and production licensing round. “We will launch another tender next year after evaluation,” he said after the bids opening ceremony.


Canamens Ventures into Eassaouira

Canamens has signed a suite of agreements — including an Association Contract, a Petroleum Agreement and a Reconnaissance Contract, along with associated permits and a license — to explore for oil in Morocco.

These agreements were signed in Rabat on December 15, 2008 between Canamens and Morocco’s Office National Hydrocarbures et des Mines (ONHYM).

The first agreement is a Reconnaissance Contract in respect of the “Essaouira Shallow Offshore” area, located in shallow water (<500 metres). Canamens will reprocess and acquire new 2D seismic and following evaluation prospectivity, decide whether to convert the license to an exploration permit, or elect not to proceed.

The second and third agreements are an Association Contract and Petroleum Agreement which govern four Exploration Permits for a similar location but in deeper water (generally over 500 metres), the “Essaouira Deep Offshore” area. Under these agreements Canamens will reprocess and acquire new 2D seismic and, following evaluation, have the option to extend into a second period with an accompanying 3D seismic and drilling commitment, or drop without further obligation.

Under these agreements, which cover an area of over 11,000 square kilometres, Canamens will be the operator with a 75% equity stake in both the Reconnaissance Licence and the Exploration Permits, with the remaining equity held by ONHYM. Canamens will bear 100% of the costs up until the development stage. The agreements represent Canamens’ first investment in Morocco.


White Nile Wins Ethiopian Lease

WHITE NILE LTD HAS SIGNED A Production Sharing Agreement (PSA) with the government of Ethiopia for a 29,000 sq km block in the Southern Rift Basin in southwestern Ethiopia. Under the terms of the PSA, the UK operator has received sole rights for the exploration, development and production of petroleum in the contract area in return for satisfying various development commitments. The PSA follows a two year Joint Study Agreement (JSA) with the Ethiopian government’s Petroleum Operations Department of the Ministry of Mines over the prospective East African rift system in the southwest region of the country. Geophysical and geological work, primarily in the Omo River area to the north of Lake Turkana, has confirmed the presence of deep potential hydrocarbon-bearing sedimentary basins within the JSA area. The prognosis by White Nile and its advisors is that the contract area is sited at an intersection between a southeast extension of the petroliferous Cretaceous and early Tertiary basins of southern Sudan, in particular the Muglad rift system and the younger East African rift system, which is proving petroliferous in Uganda as underlined by Tullow Oil Plc’s recent progress.

Under the PSA, the Government of Ethiopia has granted the sole right to White Nile to explore, develop and produce petroleum in the contract area, There is an initial exploration period of four years from the date of execution, and a development period and production period of 25 years from the date of adoption of the development plan. During the initial exploration period, White Nile is required to make a minimum expenditure of $6 million for seismic operations and a minimum expenditure of $8 million for drilling operations. White Nile plans to begin seismic operations in Q4 2008, prior to which it will conduct extensive geological field work and preparation for the geophysical programme.

“Following the highly successful JSA with the Petroleum Operations Department of the Ministry of Mines, I am very excited that this PSA has been signed to develop the Southern Rift Basin area,” White Nile Chairman Phil Edmonds said. “We have been encouraged by early work, especially with the identification of deep basins, potentially containing sedimentary sections similar to that of the petroliferous Muglad and Melut Basins of southern Sudan and also those in Uganda.

“The agreement in Ethiopia is part of White Nile’s strategy of building a regional oil company, which I believe we have the ability to achieve. The geology seems to connect Uganda, Ethiopia and southern Sudan so our land positions are in ideal locations to take advantage of this situation.”


Tullow Gives Up A Bird in the Hand

The Irish Operator Sells Off A Producing Asset In Congo In Favour Of Development of Spectacular Discoveries In Ghana and Uganda

WHEN TULLOW OIL ANNOUNCED it was selling off its interest in a 46,500BOPD field(2007 average) onshore Congo, some analysts wondered whether that wasn’t a lot to give up for a mid sized independent, especially in an era of high oil prices. The ostensible reason for selling was to raise cash to spend on the promising discoveries in deepwater Ghana and onshore Uganda.

Is that not losing a bird in the hand for two in the bush?

Afterall, deepwater development, at 1,200 metre water depth anywhere, is quite expensive and the Ugandan discoveries, which are over 1,200 km from the nearest seaport, don’t look, on paper at least, like an immediate cash cow.

The questions stopped when it was realized that the Irish operator was getting $435 million from the Korea National Oil Company for giving up about 5,000BOPD of the Mauriel et Prom operated M’boundi field. This is 11% stake. Tullow outrightly sold its subsidiary company – Tullow Congo Limited- to the Koreans. Mboundi is undergoing an injection of 1 0,000Barrels Of Water Per Day (BWPD) which will increase to 40,000BWPD by the end of 2008. Is this the evidence that the reservoirs are difficult to manage? “M’Boundi is now entering a new phase in its development at a time when Tullow is also looking to reallocate capital resources to projects where it has more material participation and influence”, Tullow said in a release.

Tullow’s cash flow comes mainly from Gabon, Equatorial Guinea and Cote Dlvoire, where assets are delivering over 35,000BOPD on a net basis. Tullow is going to be leveraging on the cash generated from fields in these countries as well as money from the Mboundi disposal to advance its appraisal and development programmes in Ghana and Uganda and to continue business development elsewhere.

For some reason, Tullow has been looking to get out of Congo. Two years ago, there was a buzz all over that the Irish owned operator would sell its 4%interests in the Moho-Bilondo, N’Kossa and N’ Soko exploitation permits offshore Congo to TOTAL for $72MM.

Tullow has also divested its 15% in Block 24, located in an unremarkable site off Angola. The acreage is in Benguela sub basin, where oil majors have endured a spate of dry holes. Tullow, however is keen on its 50% participation in Block 1/06, containing three undeveloped oil fields located in the prolific Lower Congo Basin. Tullow is equally bullish on Cote Dlvoire, where it has interest in the 27,000BOPD East and West Espoir fields with 3,000BOEPD of associated gas. Upgrading the processing facilities will increase the liquid handling capacity from 50,000 to 70,000 BFPD by early 2010. This upgrade could also facilitate a further infill drilling programme on East Espoir and the earlier tie-back of potential satellite fields. This is another reason to raise cash.

There are challenges here and there, of course.  Tullow is having a hard time convincing the Namibian authorities to move forward on the 1 .3tcfKudu gas project. The latest report is that Namcor, the state power utility, has dropped down Kudu Gas-to-Power project on the list of its priority power projects, describing it as marginal and a non- commercially viable standalone project, “as it is characterized by a high US dollar-denominated gas price, meaning that the foreign exchange and hedging cost will translate into high electricity tariffs.”

Tullow and its partners have commenced field development studies to ensure earliest first production of the deepwater Jubilee field(formerly known as Mahogany and Hyedua) off Ghana. Two rigs have been contracted to drill up to seven exploration and appraisal wells. In Uganda the Ngassa well was progressing as of the time of writing this report and the Butiaba multi-well programme was scheduled to commence in March on the Taitai prospect.

Tullow has been bullish on Uganda, but the uncertainties of the region cannot be dismissed out of hand. Operators here could easily find themselves in the crossfire between troops loyal to President Yoweri Museveni of Uganda and those who back Joseph Kabila of the Democratic Republic of Congo. The low intensity war in the Great lakes region can blow up in anyone’s face.


The lvoriens Buy Into Congo

SNPC, THE STATE HYDROCARBON company of Congo-Brazzavile, has farmed out a 30% interest in the 128-sq km MengoKundji-Bindi permit to Côte d’Ivoire state Petroci. It’s the first time Petroci takes on a working interest in any lease outside its home bastion. Mengo-Kundji-Bindi is a marginal field block carved-out from Le Kouilou (A) permit. SNPC is operator with 40%, Prevail En30%, Petroci 30%.


SOCO farms out Marine XI block interest

 CONGO

SOCO Exploration and Production Congo S.A. has agreed to farm-out 8.5% of its interest in the Marine XI block, offshore the Republic of Congo, to Petrovietnam Exploration Production. The deal is subject to government approval. SOCO EPC will remain the operator with a 29% working interest in the block. The remaining interests are held by Lundin Marine SARL (18.75%), Raffia Oil SARL (18.75%), the national oil company Société Nationale des Pétroles du Congo (15%), and Africa Oil & Gas (10%). The Marine XI block is in water depths ranging up to 110 metres and covers approximately 1,400 sq km. A multi-well drilling programme is scheduled for the second half of 2008.

© 2018 Festac News Press Ltd..