Sintana Energy (TSX-V:SEI, OTC:ZDEXF) has announced that Woodside Energy, Inc, a wholly-owned subsidiary of Woodside Energy Group Ltd (ASX:WDS, LSE:WDS, OTC:WOPEF) has entered into an option agreement to acquire a 56% participating interest in Petroleum Exploration License 87 (PEL 87).
The company said the consideration for the option, among other things, includes paying the full cost for a 3D-seismic survey covering an area of at least 5,000 square kilometres within the PEL 87 licence area at an estimated cost of US$35 million.
Woodside will have a period of at least 180 days after the delivery of the seismic survey data to exercise that option, Sintana said, adding that if Woodside exercises its option, it has agreed to enter into a farm-out agreement whereby Woodside will carry the existing joint venture partners during the drilling of the first exploration well to be drilled on the Licence Area after the completion of the seismic survey.
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Sintana said that seismic surveying is expected to start this month with fast-track processed results expected in late June of this year.
The company noted that Custos Investments, in which it owns an indirect minority interest, will retain a 15% interest in PEL 87 and benefit from this carry and other elements of related farm-out and joint operating agreements.
“The transaction strengthens the positioning of both Custos and Sintana in Namibia. Specifically in an area that has emerged as the exploration hot-spot in recent years, particularly after the recent discoveries by Total Energies and Shell,” Custos chairman and CEO and Sintana director Knowledge Katti said in a statement. “We are excited to make further progress with Woodside on Block 2713. The block has been previously mapped with good quality technical data and the new survey will enable us and our co-venture partners to mature these exciting prospects for drilling,” he added.
Recent discoveries
Sintana said PEL 87 covers an area of 10,970 sq km and hosts the large Saturn turbidite complex on-trend with the recent major oil discoveries made in the Orange Basin including Total’s Venus-1 discovery and Shell’s Graff-1 and La Rona-1 and recent Jonker-1 (2023) discoveries that have proven a working light oil system offshore Namibia.
It noted that Shell has now commenced a multi-well drilling program with Jonker-1 near the Graff discovery, and Total has announced its intention to deploy half its global exploration budget for 2023 using two rigs to drill further exploration and appraisal wells in the Orange Basin.
“We are pleased to confirm further progress on attracting capital and world-class partners to our portfolio of assets in the Orange Basin. The success in executing our strategy speaks to the quality of our portfolio and the continuing emergence of the Orange Basin as the world’s next great hydrocarbon province,” Sintana president and director Robert Bose added. “We expect significant additional activity on our blocks and on those around us over the next 12 to 18 months that will further demonstrate the scale, scope and potential of our portfolio.”
Sintana Energy is a public oil and gas exploration company. Its current projects include four large, highly prospective offshore licenses in the Orange and Walvis Basins and one onshore petroleum exploration license in Namibia and the unconventional resource at VMM-37 in Colombia’s Magdalena Basin.
Contact the author at stephen.gunnion@proactiveinvestors.com