Tullow Acquires 35% Stake in Comoros PSC

By Shem Oirere
Thursday, November 29, 2018

The wheels of discovering and exploiting hydrocarbon resources offshore the Union of the Comoros, off Africa's east coast, may have been moving albeit slowly since 2008 when the government first invited bids for exploration of oil and gas in the Indian Ocean's volcanic archipelago.

But this week's reports of the U.K.-based Tullow Oil's subsidiary, Tullow Comoros Ltd, signing a deal to acquire 35 percent working interest in the island nation's Blocks 35, 36 and 37 from London-based Discover Exploration's affiliate Discover Exploration Comoros, is a strong indicator the long wait for drilling of at least the first oil and gas well could soon come to an end.

Discover Exploration, which received approval from Comoros' National Assembly for the production sharing contracts covering the three blocks in 2014, is reported to have signed a binding agreement with Tullow Comoros Ltd for the assets, a transaction, which when fully approved by Comoros authorities, will allow Tullow to become the operator, “and will partly carry Discover for a 3D seismic survey and the first exploration well.”

Separately, Discover has also signed a conditional agreement with Kenyan-based Bahari Resources for the latter's entire issued share capital. Bahari, which became the first exploration company to be awarded oil exploration license in Comoros in 2012, holds 40 percent stake in the Comoros PSC, a joint venture with Discover.

When the transactions will be completed, Discover Exploration will hold a 65 percent non-operated working interest in the Comoros PSC, through its wholly-owned subsidiaries of Discover Exploration Comoros and Bahari, while Tullow will hold the remaining 35 percent and operatorship, through its wholly-owned subsidiary Tullow Comoros Limited.

The proximity of the 16,063-square-kilometer deepwater Comoros PSC area to the Rovuma Areas 1 and 4 in Mozambique is a key motivator for Comoros' drive to woo more exploration companies to invest in the country's hydrocarbons sector.

In fact, the two areas in Mozambique are located in the western part of Comoros' Exclusive Economic Zone and have attracted international attention after discovery of more than 200 trillion cubic feet (tcf) of natural gas by Italy's Eni (Area 4) and U.S.' Anadarko and its partners (Area 1). Discover Exploration management team was involved in the venture through the company's predecessor, Cove Energy plc.

Other current joint venture partners in Rovuma Area 1 and 4 are China National Offshore Oil Corp., ExxonMobil Corp., Mitsui & Co, and PTT Exploration and Production (PTTEP).

Comoros, which approved a new Petroleum Code in late 2012, is further motivated to push for increased exploration of its oil and gas resources by the August 2018 Competent Persons Report by U.K.-based independent energy consultancy ERCE.

The ERCE report puts the gross mean unrisked prospective resources at the two partly stacked prospects in Comoros blocks 35, 36 and 37 at 7.1 billion barrels of oil (+1.1 TCF of associated gas) in an oil case or 49 TCF of non-associated gas (+2.3 billion barrels of condensate) in a gas case.

More than four years ago both Discover and Bahari acquired and interpreted 3,900 kilometers of 2D seismic data in addition to seep and regional studies that identified several structural and stratigraphic traps in stacked Eocene and Cenomanian fans, analogously to the Eocene sands encountered in Coral (Area 4) and Tubarao (Area 1) reservoirs.

Discover Exploration could be on the way to launching the second exploration phase in Comoros with the aim of acquiring 3D seismic data and further de-risk identified prospects according to its previous reports.

With Comoros' neighbors having announced new hydrocarbon finds, which have turned them into oil and gas exploration hots spots, hopes are high the island nation could probably turn out to be what a government official previously called “one of the last prospective offshore frontier for oil and gas.”

Categories: Energy Mergers & Acquisitions Drilling Oil Africa

Related Stories

LLOG Orders 20k Trees for Shenandoah

Martin Linge, Njord Cost Estimates Climb

Iranian Tanker Hit by Missiles, Oil Rises

Keppel Delivers Jackup to Borr Drilling

Production 4.0

Saudi IMI Signs Jack-up Deal with GustoMSC

Record US GoM Production Expected to Continue

An Unusual Abandonment

OSV Owners Waiting for Better Days in Brazil

Eni Won't Drill Off Cyprus if Warships Sent In

Current News

Offshore Wind Cable Market to Grow 57% by 2023

Saudi IMI Signs Jack-up Deal with GustoMSC

Drilling Activity Buoyant in Norway

Orsted Chooses CWind Hybrid SES

An Unusual Abandonment

Finding New P&A Alternatives

Industry Shares North Sea Data with Scientists

SBM Secures Liza Unity Financing

How Brazil's $26 Bln TOR Auction Works

Greater Castberg Survey Wraps Up

Magazine

Offshore Engineer (Sep/Oct 2019)

This issue of Offshore Engineer is dedicated to Big Data and Digitalization

Archive
Subscribe

Subscribe for OE Digital E‑News

OE Digital E-News is the subsea industry's largest circulation and most authoritative ENews Service, delivered to your Email three times per week