The Australian oil and gas company Woodside Energy has entered into an agreement for an option to acquire a 56% Participating Interest in Petroleum Exploration License 87 (“PEL 87”) offshore Namibia.
This is according to the Canadian company Sintana, which through a stake in Custos Investments, owns a stake in the PEL 87 block.
SIntana said that Woodside will have the option to take the 56% stake in the block in consideration for, among other things, paying the full cost for a 3D-seismic survey covering an area of at least 5,000 square kilometers within the license, at an estimated cost of US$35 million.
Woodside will have a period of at least 180 days after the delivery of the seismic survey data to exercise that option.
If Woodside exercises its option, it has agreed to enter into a farmout agreement whereby Woodside will carry the existing joint venture partners during the drilling of the first exploration well to be drilled on the Licence Area after the completion of the seismic survey. It is anticipated that seismic surveying will start in March 2023 with fast-track processed results expected in late June of this year, Sintana said.
Custos Investments (Pty) Ltd. (“Custos”) retains a 15% interest in PEL 87 and benefits from this carry and other elements of related farmout and joint operating agreements. Sintana owns an indirect minority interest in Custos.
“The transaction strengthens the positioning of both Custos and Sintana in Namibia. Specifically in an area that has emerged as the exploration hot-spot in recent years, particularly after the recent discoveries by Total Energies and Shell,” said Knowledge Katti, Chairman and CEO of Custos and Director of Sintana. “We are excited to make further progress with Woodside on Block 2713.
According to Sintana, the block has been previously mapped with good quality technical data and the new survey will enable us and our co-venture partners to mature these exciting prospects for drilling,” he added.
PEL 87 covering an area of 10,970 sq km, hosts the large Saturn turbidite complex on-trend with the recent major oil discoveries made in the Orange Basin including Total’s Venus-1 discovery and Shell’s Graff-1 and La Rona-1 and recent Jonker-1 (2023) discoveries have proven a working light oil system offshore Namibia, Sintana said.
Sintana noted that Shell had started a multi-well drilling program with Jonker-1 near the Graff discovery, and TotalEnergies has announced its intention to deploy half its global exploration budget for 2023 using two rigs to drill further exploration and appraisal wells in the Orange Basin.
“We are pleased to confirm further progress on attracting capital and world class partners to our portfolio of assets in the Orange Basin.
The success in executing our strategy speaks to the quality of our portfolio and the continuing emergence of the Orange Basin as the world’s next great hydrocarbon province,” said Robert Bose, President and Director of Sintana. “We expect significant additional activity on our blocks and on those around us over the next 12 to 18 months that will further demonstrate the scale, scope and potential of our portfolio.”