Petroleum Africa
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Friday, April 25, 2014
FAR Ltd. has received a number of shareholder enquiries about its current drilling program in Senegal and future plans in Kenya. Currently the company is drilling the first of two potentially high-impact exploration wells offshore Senegal, with its JV partners Cairn Energy, ConocoPhillips, and Petrosen. The well was spud on April 17 and is the first of five that FAR plans to participate in.
Of these five wells, the first two are being drilled back to back offshore Senegal and funding for these two wells has been provided for through its farm out of stakes to Cairn Energy and ConocoPhillips.
The company saw a third farm out resulting in it being fully carried in Kenya on the onshore portion of Block L6. This farm out was with Milio International and consists of a full carry on an onshore well and an onshore seismic program due to commence in June 2014. The well is expected to be drilled in early 2015 once a final drilling location is selected from the new seismic data. FAR retains a 24% interest in the onshore part of Block L6.
In the offshore portion of Block L6 where FAR currently has a 60% interest, FAR is currently progressing a farm-out initiative for drilling an offshore well. The recent Sunbird-1 discovery well drilled by the BG Group in the nearby Kenya Block 10A targeted a Miocene reef structure. The Miocene reef play extends along the coast of Kenya and through both of FAR’s offshore blocks, L6 and L9. With the very encouraging Sunbird-1 well results, FAR anticipates strong industry interest in its L6 farm-out opportunity.
The fifth of its planned wells is offshore Guinea Bissau where FAR has assessed significant upside potential around the existing Sinapa oil field contained in the company’s licenses. The JV will continue to monitor the current political climate in Guinea Bissau as an election process is currently underway. Drilling is currently scheduled to commence in March 2015.
Cath Norman FAR’s MD said: “FAR is in an enviable position as we commence our drilling program in Senegal. The company has two strong partners, retains a high equity in any discovery made and is well funded to meet its commitments in these wells and our forward work program, having close to $27 million in cash at bank and no corporate debt. Success in either of these two wells offshore Senegal will be significant and open the door to a large inventory of follow on drill targets creating sizeable upside for the company and its partners. It is a fantastic milestone for the company and one that we aim to reproduce in Kenya where we are currently progressing a farm-out initiative. We expect that the success of the recent Sunbird-1 well will change the exploration landscape offshore Kenya where opportunities for our shareholders.”
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