Nigerian-based South Atlantic Petroleum (Sapetro) and Houston-based Hyperdynamics have agreed to a farmout, allowing Sapetro to pick up 50% participating interest in the production sharing contract covering the deepwater Fatala turbidite fan prospect, offshore Guinea, in West Africa.
Sapetro will pay 50% of the Fatala exploration well costs and reimburse Hyperdynamics' subsidiary SCS for half of the previous well costs since the PSC's second amendment was signed, Hyperdynamics says. The US firm estimates those previous costs to be approximately US$8-10 million. Sapetro and the Guinea National Petroleum Office signed a tri-partite protocol on 10 March setting a deadline for submission of farmout documents by 10 April and spudding of the Fatala exploration well by 30 May.
"We are very excited about Sapetro's commitment to join Hyperdynamics in this high-potential opportunity to unlock the value of Fatala and several additional prospects identified by our geoscientists on the 5000sq km PSC block," said Ray Leonard, Hyperdynamics' president and CEO.
"With funds already invested by SCS in preparation for the Fatala well, past cost reimbursement and Sapetro gearing up to join the project as a 50% partner, Hyperdynamics' share of the remaining funding needed is now estimated at $15-20 million. The Fatala prospect alone has an estimated mean recoverable resource of 647 MMbo based on a 2016 Netherland Sewell report, with an estimated 31% chance of success," Leonard said.
Previously, Hyperdynamics has expressed its enthusiasm for its Guinea PSC saying, "Multiple play types, leads and prospects have been identified in this largely unexplored basin at the intersection of several prospective exploration trends within the Atlantic Transform Margin."
In January, the Houston explorer announced it would use Pacific Drilling's Pacific Scirocco drillship to drill its upcoming Fatala-1 exploration well. The well was originally set to spud in April 2017. That same month, Hyperdynamics signed a master services agreement with Schlumberger to provide essential drilling services for Fatala-1. Schlumberger's scope of work includes: wireline logging, measurement while drilling, logging while drilling and similar downhole drilling services, drilling fluids and solids control services, downhole cementing services, mudlogging services, drilling bits and reamers, and contingency fishing equipment and services. Hyperdynamics estimates that the value of the master services agreement for the Fatala-1 well is approximately $4.5 million.
Image: Guinea lease map from Hyperdynamics