Europa Oil & Gas, a UK and Ireland focused exploration, development and production company, has signed a farm-out agreement (FOA) with Cairn Energy for Licensing Option 16/19 offshore Ireland.
Europa O&G said on Wednesday that it farmed out 70 percent interest and operatorship of the license, which is located on the Western flank of the South Porcupine Basin, to Cairn’s wholly owned subsidiary Capricorn.
According to the company, the farm-out is subject to Irish Government approval.
Under the deal, Capricorn will fund a $6 million work program, which includes the acquisition, processing, and interpretation of 3D seismic.
The seismic work will be acquired in 2017 while the processed data will be delivered in 2018. Any future exploration will be based on the results of detailed prospect mapping work. Europa will fund its 30 percent interest in LO 16/19 on completion of the fully carried work program.
The license is covered by a sparse grid of 2D seismic and while detailed prospect mapping is not possible, Europa’s proprietary 3D in its adjacent Frontier Exploration License (FEL) 2/13 is interpreted to contain Cretaceous submarine channels feeding submarine fans in LO 16/19.
The company believes that LO 16/19 holds Cretaceous fans similar to those developed in Europa’s 100 percent owned FEL 3/13 where three prospects have been identified with combined gross mean unrisked prospective resources of 1.5 billion barrels of oil equivalent
This FOA is the first by any company in Atlantic Ireland since 2013, with the company also offering farm-outs on its remaining six 100 percent-owned licenses.
Europa CEO Hugh Mackay said: “We are delighted to have secured a farm-in partner of the proven caliber of Cairn, and also to accelerate exploration on the license through the acquisition of 3D seismic this summer. We continue to talk to other potential partners for our remaining six offshore Ireland licenses which provide us with exposure to all the various play types being targeted in the region.
“Activity across the Porcupine Basin is expected to increase markedly this year and beyond as Providence Resources is expected to drill the Druid prospect in 2017, two new exploration wells may be drilled in 2018, and a natural conclusion to 3D seismic data acquired this summer and last summer could be more exploration drilling.”