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Thursday, June 4, 2015
Sterling Energy’s wholly-owned subsidiary, Sterling Energy Mauritania Ltd. (SEML), signed a sale and purchase agreement (SPA) with Tullow Mauritania to acquire a 13.5% interest in the PSC for Block C-10 offshore Mauritania.
Under the terms of the SPA, on completion SEML will assume a 13.5% participating interest in the PSC from Tullow, including an entitlement to some of the past costs associated with the participating interest, and SEML will pay Tullow $50,000 in cash as consideration and in repayment of interim period costs. The purchase of the 13.5% stake will be financed through existing cash resources.
Completion of the transaction remains subject to the approval of the Mauritanian government.
The Block C-10 PSC, awarded in 2011, is in the second phase of the exploration period. It covers an area of approximately 10,725 sq km offshore Mauritania. The current phase will expire at the end of November 2017 and has a minimum work obligation of one exploration well.
The block surrounds the Chinguetti field, within a proven petroleum basin and offers exposure to multiple play-types from the under-explored Jurassic and lower Cretaceous carbonates to Cretaceous and Tertiary clastic plays. The potential for the extension of the Cenomanian and Albian plays recently established by the Tortue-1 well drilled by Kosmos in Block C-8 will be investigated on Block C-10.
Tullow has identified a drill ready Neocomian carbonate prospect in a water depth of approximately 100 meters. Technical work will focus on maturation of the prospect inventory following the receipt of recently merged, reprocessed and depth migrated 3D seismic.
The JV anticipates that the exploration well will be drilled in 2016. The gross cost of the well is anticipated at $77 million. Should the JV not fulfill the minimum work obligation, the JV gross liability to the government would be $7.5 million.
Following the completion of Phase 2, the JV may elect to enter into Phase 3 (with a three-year term) with a minimum work obligation of two wells.
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