Tullow and Pancontinental Oil & Gas subsidiaries entered into an agreement to amend the farm-out agreement for exploration license 0037 (EL 0037) which covers 17,295sq km (4.2 million acres) in water depths extending to 1800m in the Walvis basin offshore northern Namibia.
Tullow recently requested from Pancontinental an extension to a deadline under the farm-out agreement concerning a “drill or withdraw” decision by Tullow, which was to have been made by 11 August 2015. Pancontinental has agreed to an extension of the deadline to 31 March 2016.
The extension will allow the joint venture time to further assess the results of the extensive exploration program of 3D seismic and geological work that have been carried out to date.
The joint venture led by Tullow has mapped a number of large turbidite “fan” prospects, some of which are interpreted to be at approximately the same stratigraphic level as the oil found in Wingat-1, to the south of EL 0037 and in the same geological system, as well as close vertically to the interpreted oil source rocks.
Since farming-in to the project in 2013, Tullow has undertaken exploration work costing approximately US$34 million of the overall estimated farm-in program. In order to retain its 65% interest Tullow must now fully fund one exploration well at no cost to Pancontinental. Pancontinental is optimistic that Tullow will continue exploration on the blocks and proceed towards drilling.
Image: EL 0037 oily sweet spot/Pancontinental
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