Ophir Energy plc has entered into an agreement with WHL Energy (“WHL”) to acquire a 75% operated interest in Blocks PEC-5B/1 and PEC-5B/2 located offshore to the south of the Seychelles Islands in the Indian Ocean.
In exchange for the acquired interest, Ophir will repay back costs to WHL of US$4mln and fund the acquisition of 1,500 km2 of 3D seismic data. If Ophir elects to retain its interest in the licences beyond mid-2015, it will pay further contributions towards the next exploration phase.
This agreement secures a substantial, operated footprint in an oil-prone frontier basin in which a number of leads have already been identified on the existing 2D seismic data. The majority of these leads are located in water depths of less than 75m which should reduce drilling costs. The Seychelles is a lightly explored province, although encouragingly, oil shows have been observed in wells drilled to the west of the acquired acreage.
The acquisition is conditional on the Government of Seychelles providing consent and approval of an amended and restated petroleum agreement under which the interest is held.
Nick Cooper, CEO, commented:
“Ophir’s preferred exploration model is to secure large operated positions, with significant running room, in frontier basins where the fundamental elements of a hydrocarbon system are in evidence. We are therefore pleased to have executed this material new basin entry into the offshore East Africa area. Our initial analysis already highlights a portfolio of structural prospects and leads and we look forward to pursuing an active exploration programme in the area to test this thesis.”
Press Release, March 04, 2014; Image: WHL