Total has agreed an option agreement with Eco (Atlantic) Oil & Gas to acquire a 25% stake in the Orinduik Block, offshore Guyana, South America.
Eco subsidiary Eco Guyana currently holds a 40% working interest in Orinduik, with Tullow Oil, the operator, holding the remaining 60%.
The Orinduik Block is up dip and just a few kilometers from Exxon’s recent Liza and Payara discoveries confirming, by Exxon’s estimates, between 2.25-2.75 billion bbl of recoverable oil.
Total will pay US$1 million for the option, and $12.5 million if it decides to take the 25% stake. The exercise of the option must be made within 120 days of completion of processing of recently acquired 3D seismic data. Processing of the data is expected to take 2-3 months.
Eco says exploration wells offshore Guyana cost about $35 million each. Gil Holzman, President and CEO of Eco Atlantic, said: “In the event that the option is exercised by Total, the deal proceeds will recoup all our expenses on the expanded 3D program and fund us for drilling a minimum of two wells based on current well costs. This deal is also expected to introduce into Guyana yet another significant global player and we look forward to working with Total as well as Tullow in the years to come."