West Africa focused African Petroleum has inked an agreement with Sierra Leone's Petroleum Directorate to enter a second extension periods on ultra-deepwater licenses SL-03 and SL-4A-10.
The work programs for both licenses, in 3000-3600m water depth and containing the Leo and Vega prospects, will also be modified.
African Petroleum says that the ultra-deep water setting of the licences has garnered limited industry interest during the low oil price environment. But, it says there has been increased industry interest due to technology improvements and cost reductions in ultra-deep water drilling, together
with the potential of the prospects identified on the licences.
The second extension period will now expire on 23 April 2019 for the SL-03 license and on 17 September 2019 for the SL-4A-10 license, dependent on a commitment, prior to 1 November 2018, to drill one exploration well in each license area during the remaining term of each license.
During the next 12 months, Africa Petroleum says state-owned well and seismic data, together with existing seismic data, will be assessed to further derisk the licenses before to deciding to commit to drilling exploration wells.
Jens Pace, African Petroleum’s CEO, says: “Based on recent discussions we have held with industry players, we are aware of an increased appetite for material ultra-deep offshore opportunities, driven by the advancements in drilling technology and the decrease in operating costs. The additional flexibility afforded by the amended commitments will help us to introduce new parties to the project."
African Petroleum, acording to terms of the license, has relinquished 50% of the SL-03 license area, reducing the license area from 1930sq km to 962sq km, and 50% of the SL-4A-10 license area, reducing it from 1995sq km to 995sq km.
Sierra Leone's petroleum directorate has agreed to modify the work programs and minimum spending requirements of the two licenses, and to defer the social obligations of the two licenses contingent on the drilling of an exploration well on each license.
It is expected that the revised prospective resources for the SL-03 and SL-4A-10 licences will be published shortly.
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