UK independent Fastnet Oil and Gas agreed an amended exclusive option agreement with Petrobras subsidiary PSE Kinsale Energy in relation to the Deep Kinsale prospect, offshore Ireland.
The Deep Kinsale prospect extends from 4000ft subsea below the producing Kinsale Head gas field and is defined by a sub-area of Petroleum Lease No. 1.
Fastnet's revised terms include: an extension of an option agreement to 31 March 2015, with a commitment to start drilling a farm-in well extended to on or before 31 December 2016.
On completion of this farm-in well, Fastnet's net equity interest over the license will be fixed at 60%.
Fastnet is looking for a partner to help spread the expected cost of the well.
Paul Griffiths, Managing Director of Fastnet, said: “The new terms of the Deep Kinsale Prospect greatly improve the project economics and significantly improves materiality for Fastnet and any potential Farminee. The extension of the deadline to exercise the option and the commencement of a well works well with our timeline to complete a farm-in transaction from our ongoing process. Fastnet has considerably advanced the technical understanding and de-risked the opportunity at Deep Kinsale based on our extensive interpretation of our newly acquired 3D seismic data (2013). Fastnet has progressed potential farmiin discussions with a number of industry players and we seek to close out a transaction with a potential drilling partner for Deep Kinsale and recover substantial past costs to further strengthen our already significant discretionary cash balances.”
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