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Friday, October 25, 2013
Sterling Energy issued its Interim Management Statement for the period beginning July 1 and updated operations in Cameroon, Madagascar, and Mauritania.
In Madagascar Sterling holds interests in the Ampasindava and Ambilobe blocks with a 30% and 100% stake respectively. On the Ambilobe Block the company has completed all its commitments for the current exploration phase. The company is considering a discretionary 2D seismic program in early 2014 to mature identified leads into one or more drill-ready prospects. There is also a farm out process in the works to bring in a JV partner.
On the Ampasindava Block which contains the Sifaka prospect, independently assessed to potentially contain, un-risked, gross best estimate prospective resources of 1.2 billion barrels. As a result of the farm-in to the Ampasindava Block by ExxonMobil in 2005 (70% working interest and operator), Sterling’s costs in this block are carried up to a fixed gross amount. The cost to drill the Sifaka prospect will exceed the remaining gross carry and Sterling has engaged in a farm-out process to introduce an additional partner to fund its share of the drilling costs.
ExxonMobil and Sterling have agreed to acquire an infill discretionary 2D seismic program in late-2013/early-2014 to provide additional control over the Sifaka prospect and to delineate previously identified prospects within the Sifaka trend. Drilling is being planned for 2015 or 2016.
Agreement has been reached with OMNIS, the state regulator, to prolong the current exploration period of both the Ambilobe and Ampasindava PSC, with no changes to the work commitments. These agreements have now been signed and ratified.
In Mauritania where Sterling has production through its stake in the Chinguetti field, the company saw its Q3 production total 48,440 barrels of oil net. Sterling’s net production was down from the same period in 2012; the reduction in production levels are consistent with normal production decline in addition to an unplanned three-day interruption in September.
In Cameroon on the Ntem concession area things have maintained their status quo. The block remains in force majeure; Sterling believes that the governments of Cameroon and Equatorial Guinea continue to work towards a resolution of their border dispute however there is no definitive timetable for reaching a resolution. After the force majeure is lifted there will be 15 months remaining in the current exploration period during which one exploration well must be drilled.
Alastair Beardsall, Sterling’s Chairman and Interim CEO, said: “Sterling has interests in three large and highly material exploration blocks; progress continues to be made in planning the drilling of exploration wells in these blocks, offshore Cameroon and Madagascar. Sterling remains committed to add new opportunities to our existing portfolio that will deliver real growth potential and ultimately value for our shareholders.”
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