11th May 2015 07:19
LONDON (Alliance News) - Cairn Energy PLC Monday said it has submitted a three-year evaluation work plan to the government of Senegal, which, if approved, will allow drilling on a new basin around the SNE-1 discovery well later in 2015 to compliment the existing discoveries in the area and could lead to a resource of over 1.0 billion barrels of oil.
Cairn and its joint venture partners have submitted the plan, which includes an initial programme of three firm and three optional exploration and appraisal wells in Cairn's new basin play offshore Senegal focused on the acreage around the SNE-1 discovery well.
Cairn has a 40% working interest in the SNE-1 well, with ConocoPhillips holding a 35% working interest and Petrosen, the national oil company of Senegal holding the remaining 10%.
The three well programme is currently planned to include two appraisal wells of the SNE-1 discovery which will core and test the reservoir, as well as one shelf exploration well. Cairn said it will present a work programme and budget for the three optional wells to its joint venture partners in the third quarter of 2015.
The FTSE 250-listed company said it believes the two discoveries it has already made in the area and the identified prospects on the new basin could hold over 1.0 billion barrels of oil when combined.
"Cairn believes there is substantial prospectivity across all three of its blocks and to date at least five prospects and eighteen leads have been identified and continue to be matured to drillable status," said Chief Executive Simon Thomson. "Cairn estimates that the existing two discoveries and the currently identified prospects and leads have an estimated mean risked resource base of more than a billion barrels."
Cairn is in the final stages of working with its joint venture partners to finalise the rig contract and associated support services, which are being tendered to secure current market pricing. Cairn said it plans to use the Ocean Rig Athena, which is currently being contracted to ConocoPhillips in Angola.
If the plan is approved by the government of Senegal, the company hopes to begin drilling in the fourth quarter of 2015.
"We are excited about the exploration and appraisal opportunity of this world class asset. We have now submitted a three year evaluation work plan to the Government of Senegal which is designed to lay the foundation for a long term multi-field, multi phase exploitation plan," said Thomson.
"Our focus will be to add value in Senegal within a balanced, well funded company. We are well placed to take advantage of this exciting opportunity as we build on the success of last year," he added.
Cairn shares were up 0.6% to 188.50 pence per share on Monday morning.
By Joshua Warner; [email protected]; @JoshAlliance
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