Rocksource Farms-In to Offshore Deepwater Block in West Africa
Rocksource ASA has signed a farm-in agreement with Ophir Energy plc, allowing Rocksource to complete a staged entry into the AGC Profond Production Sharing Contract (PSC) covering the deepwater area administered by the Agence de Gestion et de Cooperation entre la Guinee-Bissau et le Senegal (AGC) which is the joint commission established by Senegal and Guinea Bissau to manage their joint maritime zone.
The AGC Profond PSC covers a large offshore block (9,838 square kilometers), equivalent to almost 25 blocks on the Norwegian Continental Shelf in size, which straddles the Senegal and Guinea Bissau border and
has water depths extending from 50 meters to 3,500 meters.
Rocksource has estimated that the block has significant potential and a planned CSEM (Controlled Source Electromagnetic Data) acquisition will test prospectivity containing approximately 1.1 billion barrels of oil equivalent (Bboe) mean unrisked, gross resources.
The farm-in allows Rocksource staged entry as it contributes to each of the three exploration phases. Rocksource will initially finance 100% of the cost of the first phase work program which consists of CSEM acquisition over three of the most prospective features in return for a 5% equity stake. The companies have also agreed a mechanism whereby Rocksource can earn up to a 25% participating interest in return for paying a disproportionate contribution towards the first and second exploration wells (2nd and 3rd Exploration
Phases) if it decides to progress beyond the initial CSEM evaluation.
If Rocksource elects not to progress into the 2nd exploration phase, then it may elect to withdraw without earning any interest in the PSC and without any further financial obligation.
Ophir has entered into various rig share agreements giving it access to potentially more than 500 days of rig time on deepwater drilling rigs suitable for use in the AGC Profond PSC area. The PSC also allows for exit points at the end of each exploration phase.
Ophir is the block Operator holding an initial 88% equity share. L'Enterprise AGC S.A. (Enterprise) representing both countries holds the remaining 12% interest.
Once the CSEM program is complete and the joint venture has agreed to drill the fist exploration well then, subject to the normal governmental consents, the partnership will consist of the following:
- Ophir Energy plc 83% (Operator)
- L'Enterprise AGC S.A. 12%
- Rocksource ASA 5%
Enterprise has an option to increase their beneficial interest by a maximum of a further 5%.
Rocksource's business model has been established to test exploration prospectivity using its proprietary CSEM technology prior to taking on larger capital commitments, such as well commitments. This agreement fits well with that strategy and is another verification of Rocksource's farm-in approach.
New Ventures Vice President Gregor Maxwell commented, "We are looking forward to working
together with Ophir and Enterprise to de-risk this block using CSEM and Rocksource's proprietary CSEM
toolkit. The area is very interesting with high impact prospects ideal for de-risking with CSEM and
we are pleased to be partnering with an experienced African Operator such as Ophir."
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