All posts tagged farm in-farm out

The Ugandan government is planning a bid round of more than 10hydrocarbon tracts in the Albertine Rift Basin in 2013, once the current ban on licensing of new acreage is lifted.

At least 14,000 square kilometres – roughly 60% of the basin – remain unlicensed, according to the ministry of Energy and Mineral Development performance report 2011/2012.

A total of 17 oil blocks were demarcated in the basin. Four of the blocks were awarded before Uganda imposed a licensing ban on new acreage in 2007. The remaining blocks will be auctioned as soon as President YoweriMuseveni enacts a new law lifting the licensing ban.

Uganda’s parliament finally passed two new hydrocarbon laws, in late December 2012, thatmay clear the way for lifting of ban on lease sale. The Petroleum (Exploration, Development, Production) Bill and Petroleum (Refining, Gas Processing, Conversion, Transportation and Storage) Bill were introduced in parliament in February 2012 to give legal effect to the national oil and gas policy that was approved in 2008.

Among those companies that have expressed interest in buying exploration tracts are some indigenous Ugandan firms, including Nile Valley Oil Exploration Plc,Intex Construction, Asker Investments Ltd, Canaan Investments Ltd and TRC Group.

Of the foreign companies keen on a slice of the Ugandan hydrocarbon property, the list includes China Petroleum Engineering and Construction Company (China), Rapid African Energy (South Africa), Sinopec (China), Marubeni (Japan), Pet Oil (Turkey), Turner And Townsend (South Africa), Whitanker Group (USA), Bain and Company (USA, India), Trans-Oceanic Projects and Developments (Kenya) and Toyota (Kenya). But the really big names that are known to have expressed interest include Italy’s Eni, Russia’s Lukoil Holdings, and India’s Essar Oil Ltd.

British explorer Tullow Oil, French major TOTAL and Chinese behemoth CNOOC are the three main players in the country. They are all planning to invest around $10-12 billion to develop oil fields in four blocks as Uganda continues plans to join the ranks of African oil producers. They have submitted a plan of development, since July 2012, which the government is considering. First oil is expected around early 2018. Ugandan authorities say that oil companies operating in the basin have had a success rate of around 87%, finding oil in 76 oil wells out of the 87 wells drilled so far. In the five years since the acreage licencing ban has been in place, some of the blocks previously licensed to oil companies have been returned to government through relinquishment requirements and the expiry of licenses.

A 2013 licensing round will be Uganda’s first since it imposed the ban in 2007, which was put in place following the confirmation of commercial oil reserves.

Vanoil Energy Ltd. has received the seven month extension to its PCS it requested from the Kenyan Ministry of Energy. This extension extends the contract for Blocks 3A and 3B from September 30, 2012 to April 30, 2013.
The extension allows Vanoil to complete the analysis of 100 sq km of high resolution 3D seismic data designed to geologically pin point its initial drill site location. The mobilization was expected to be completed in early August
2012 and data acquisition to be started mid-August and completed in early-October.

Tunisian authorities handed out two exploration permits in September, 2009. On September 11, they granted the Bouhajla Permit, to ETAP as Holder and to DualEX, a Canadian petroleum company, as Contractor. The 416 sq km onshore acreage was granted for an initial period of three years, with two renewal period of three years each, and a commitment of a seismic acquisition and an exploration well for each mentioned period.

On September 18, the acreage known as Chorbane, (which had been converted into an exploration permit from a prospecting permit), was granted to ETAP as Holder and Alpine Oil and Gas, an Australian petroleum company, as Contractor. It is situated in Central Tunisia and covers an acreage of 2428 sqkm. The contract allows an initial period of three years with two renewal periods of three years each, during which the Contractor commitments are to drill an exploration well, each mentioned periods

Shell has agreed to acquire Hess Corporation’s entire upstream portfolio in Gabon and its interest in the Clair Field, which lies in British waters west of the Shetland Islands. In return, Hess would acquire Shell’s interest in a pair of Norwegian offshore fields, Valhall and Hod. This transaction is a strategic trade and no cash payment is involved.

“We are very pleased to increase our equity stake in Gabon-a country in which we have operated with great success for nearly 50 years”, said Malcolm Brinded, Executive Director of Shell’s Upstream International Business. The swap, which is still subject to government approval and other requisite consents, would rearrange the companies’ ownership interests in Gabon, the UK and Norway. Shell’s interest in its Gabonese production licenses would increase from 42.5% to 52.5% in Rabi-Kounga, from 44.3% to 94.3% in Toucan and from 20% to 60% in Atora. Its interest in the Ozigo exploration license would increase from 44.3% to 94.3%

Sea Dragon Energy has signed a Farm- out Agreement with Dana Gas Egypt Ltd, to acquire a fifty (50%) percent participating interest in the Kom Ombo (Block-2) Concession, located approximately 1,000 km south of Cairo on the West Bank of the Nile River. The Kom Ombo (Block-2) Concession, covering approximately 11,446 sqkm, is held by Dana Gas, which is the successor company to Centurion Energy International Inc. who was originally awarded the Kom Ombo (Block-2) Concession.

The total consideration paid by Sea Dragon to DGE is $45million subject to working capital adjustments. This consideration is to be paid in full by April 30, 2010.

The acreage contains the Al-Baraka Development Lease, comprising the Al-Baraka oil field, which has a discovered, undeveloped oil accumulation of approximately 100 million barrels of Original Oil in Place as Discovered Resources in two productive zones, according to Sea Dragon’s internal estimates.

Sea Dragon’s acquisition of a participating interest in the Kom Ombo (Block-2) Concession is subject to the consent and approval of the responsible authority. Four wells were drilled in the field of which three wells are currently on production at approximately 850 barrels of oil per day (BOPD).

Approximately $20million shall be cost recoverable by Sea Dragon out of future production revenue. As owner of a 50% participating interest in the Kom Ombo (Block-2) Concession, Sea Dragon will be required to pay its 50% share of future expenditures and is entitled to receive a 50% share of all future production revenues and 50% of all cost recoveries as specified in the Concession Agreement. Under the terms of the Farmout Agreement, Sea Dragon and DGE will jointly operate the Kom Ombo (Block-2) Concession.