Elaine Reynolds
28 March 2018

UK independents pick up blocks in Mexico’s Round 3.1

Premier Oil was awarded three blocks, while Cairn Energy has picked up one block in the latest shallow water round offshore Mexico. Premier beat off bids from five other consortia for Block 30,  which was the most hotly contested of the round. The company holds a 30% WI in the Sureste basin block, which will be operated by DEA and partnered by new entrant Sapura.

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Elaine Reynolds
20 March 2018

Some way to go for FAR in FAN

FAR has today released independently assessed resource figures for the FAN deepwater basin discovery offshore Senegal. RISC assigns 2C recoverable resources of 198mmbbls, based on data from the FAN-1 discovery well, drilled in 2014. Given that the well encountered thin reservoir sands of disappointing quality, the JV has since focused on appraising and developing the more attractive SNE field that sits nearby in shallower water on the shelf.

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Elaine Reynolds
20 June 2017

South east basin most popular in latest Mexico round

Following on from our recent Offshore Mexico ‘Exploration Watch’ (Click here for report), bidding in Round 2.1 was concentrated on the south east basins and saw the first entry to the basin of supermajor Shell as well as UK independent Cairn Energy. Ten of the fifteen shallow water blocks on offer were awarded, with nine of these located in the Sureste Basin. Only one block, Block 2, was awarded (to Dea Deutsche and Pemex) in the five blocks on offer in the Tampico-Misantla and Veracruz basins.

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Elaine Reynolds
7 June 2017

Porcupine Basin attracts Total

Total is the latest major oil company to move into the Porcupine Basin offshore Ireland, a region that has been generating interest across the industry. It has entered into two separate agreements with Providence Resources and Sosina Exploration that will give it the option to farm into Frontier Exploration Licence FEL 2/14 as well as securing a 50% WI and operatorship of Licensing Option 16/27. FEL 2/14 is the location of the upcoming 53/6-A Druid/Drombeg well which is due to spud at the end of this month and was highlighted in our ‘Wells to watch 2017’ report. Click here for report  LO 16/27 is to the north of Druid/Drombeg and contains the Avalon prospect.Providence has also agreed an option to farm out a further 20% of LO 16/27 to Cairn.

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Elaine Reynolds
2 May 2017

Cairn/FAR return to deepwater FAN in Senegal

The next well to be drilled by the Cairn/FAR joint venture offshore Senegal will be the FAN South-1 exploration well, marking a shift away from the shelf and back into the basin where the first exploration well, FAN-1, was drilled in 2014.

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Elaine Reynolds
21 March 2017

Wells to watch in 2017

Since the oil price crash of 2014, exploration has been particularly badly hit as companies looked to trim expenditure. Wood Mackenzie estimates that 2017 exploration will account for 8% of upstream expenditure, down from historic norms of 14%. In this more difficult environment, any surviving exploration has tended to be led by majors, for example ExxonMobil’s giant Liza discovery offshore Guyana in 2015. In our most recent Exploration Watch, we highlight wells due to spud in 2017 that involve independent companies, with resources estimates greater than 100mmboe. Our exception is the much anticipated multi-billion barrel potential Korpfjell prospect in the Barents Sea offshore Norway, which is operated by Statoil and partnered by major companies.

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Elaine Reynolds
18 January 2017

Norway awards 56 new licences

Norway has awarded 56 new production licences under the 2016 Norwegian APA (Awards in Pre-defined Areas) Licence Round, which covered the more explored areas of the Norwegian Continental Shelf . Interest was strongest in the North Sea area with 36 awards, while 17 were awarded in the Norwegian Sea. Only three awards went in the Barents Sea, reflecting the frontier nature of the basin. Link to awards maps

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Elaine Reynolds
17 January 2017

2017 Senegal appraisal to kick off in January

Cairn Energy confirmed today that it will return to drilling offshore Senegal by the end of January this year, with two firm wells designed to further evaluate its 473mmbbl SNE discovery. The Stena DrillMax is contracted for these two appraisal wells together with multiple follow on options yet to be confirmed but which could include exploration wells in addition to further appraisal.

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Elaine Reynolds
27 September 2016

Barents Sea - frontier drilling in 2017

The Barents Sea to the north of Norway is estimated to contain almost half of the recoverable undiscovered resources remaining in the Norwegian Continental Shelf (NCS). At present only two fields, Statoil’s Snøhvit and Eni’s Goliat, are in production but a number of discoveries since 2011 have the potential to be stand-alone developments and are currently being appraised. The recent 23rd licensing round awarded acreage exclusively in the Barents and for the first time included the frontier South East Barents. Statoil has already indicated that it plans to drill the high-risk/high-reward Korpfjell prospect located in PL859 in this frontier area as part of a five to seven well Barents exploration programme in 2017.

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Will Forbes
18 July 2016

Conoco sells Senegalese discovery blocks - fair price?


Conoco’s sale of its interests in Senegal can be used as a barometer of industry sentiment and as a yardstick on valuation of the assets.

We believe the deal reached was a fair reflection of the value of the assets given the current environment, where the collapse in the oil price has lead to a re-evaluation within the industry. Conoco may have signalled its intent to sell the assets, but as a result this was an open process where all comers could have bid.

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Will Forbes
13 March 2015

Omne trium perfectum


Everything comes in threes
This week was not a good one. It has seen three major announcements by well-known London-listed oilers, resulting in week-to-date share prices falls of 20% for Cairn, 38% for Soco and 12% for Afren.

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10 March 2015

Thoughts post Cairn FY14 results & India tax update


Since we posted our blog about Cairn’s results presentation, the company has released material news on the Cairn India tax situation. It confirmed that it has received from the Indian income tax department a draft assessment order quantifying the tax claim for the 2006-07 fiscal year at $1.6bn, plus any applicable interest and penalties. Cairn had not previously given guidance on the Indian tax assessment.

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Will Forbes
5 March 2015

African Petroleum - Initiation


We initiate on African Petroleum (see link). Pure play E&Ps are not in favour of late as poor exploration results in recent years and the falling oil price has depressed sentiment. However, for investors willing to look through near-term oil prices and seek exposure to exploration risk, African Petroleum has ten offshore blocks with large working interest positions, many of which are very close to successful wells drilled in 2014 (not least SNE-1 and FAN-1 off Senegal, and Total off Côte d’Ivoire) - as seen below.

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