Australia-based explorer Pura Vida Energy has agreed in principal a deal with a rig contractor to fund a share of the costs of a three-well drilling program offshore Gabon, west Africa, in return for a share of future production on any discoveries found.
The drilling program, on the Nkembe block, will include an appraisal well on the Loba oil field and a planned production test.
The unnamed rig contractor will provide a jackup rig and fund the costs of the rig including the mobilization costs and operating day rate, in exchange for a royalty out of production from any fields discovered during the drilling campaign that are brought into production.
The rig contractor will fund about US$20 million worth of the contract. But the arrangement is dependent on Pura Vida finding a partner to fund a further $20 million of the costs, plus regulatory approvals to drill.
The drilling campaign is expected to start in 2H 2017 and will last about 3-4 months.
The first well will target the Loba discovery and Loba Deep prospect, which includes a planned drill stem test (DST) of the Loba discovery. The location of the second and third wells will be determined by Pura Vida, based on results, and may include prospects such as Loba East, Lepidote Deep, Pompano and Palomite Deep. The campaign will target about 100 MMbbl. of which 12 MMbbl is considered low risk appraisal testing of contingent (discovered) resources.
Managing Director, Damon Neaves, said: "Our plans to commercialize Loba and test the shallow water exploration potential of the Nkembe block are at the forefront of Pura Vida’s strategy and we are very pleased to have reached this conditional agreement to provide a rig and partial funding for those activities."