African Petroleum, an independent oil and gas company, is looking to enter the second renewal period at the Senegal Offshore Sud Profond (SOSP) production sharing contract (PSC).
AP, which holds 90% interest in the SOSP, entered into the first renewal period for the PSC in December 2014 and this term is due to end on December 15, 2017.
Further to ongoing discussions with the Senegalese authorities, the company said on Monday it has recently lodged an application to enter into the second renewal phase of the SOSP PSC.
Concurrently with the application, the company has requested to exchange the outstanding well commitment in the current phase for a 3D seismic acquisition program, and to transfer this revised outstanding commitment to the second renewal phase.
Should the Senegalese authorities agree to the company’s proposal then the second renewal phase will be for a term of 2.5 years with a work program commitment of acquiring, processing and interpreting 3D seismic and the drilling of one exploration well.
“Although the SOSP PSC continues to generate industry interest, the uncertainty around the status of the PSC has proven to be an obstacle to securing a farm-in partner. It is for this reason that the company has decided to proceed with entry into the second renewal phase of the PSC prior to re-engaging with interested parties,” AP explained.
To remind, AP recently allowed for its exclusivity agreement with an unnamed oil and gas company, covering the farm-out of the SOSP license in Senegal and the A1 and A4 licenses in The Gambia, to lapse due to an unresolved issue with its Gambian licenses. This exclusivity agreement was supposed to provide a framework for the incoming third party to secure a 70% operated interest in African Petroleum’s SOSP PSC in Senegal and the A1 and A4 licenses in The Gambia.
AP is still working on a solution related to the Gambian licenses A1 and A4 and it has recently started preparing for arbitration proceedings in order to protect its 100% interest.
Offshore Energy Today Staff