Pancontinental Oil & Gas NL and Tullow have agreed to amend the farmout agreement between the companies regarding an offshore block in Namibia dated 5 September 2013.
According to Pancontinental Tullow recently requested from Pancontinental an extension to a deadline under the EL 0037 block farmout agreement concerning a “drill or withdraw” decision by Tullow, which was to have been made by August 11 2015.
Pancontinental has agreed to an extension of the deadline to 31 March 2016. The extension will allow the joint venture time to further assess the results of the extensive exploration programme of 3D seismic and geological work that have been carried out to date.
“Pancontinental is very encouraged by the exploration results of Tullow’s exploration activities within the EL 0037 area,” the company said in a statement.
Since farming-in to the project in 2013, Tullow has so far undertaken exploration work costing approximately US$34 million of the overall estimated farmin programme, with Pancontinental free-carried: Led the Joint Venture as Operator; Reimbursed past costs and has 100% funded the 3D seismic survey not less than 3,000km2; 100% funded the 2D seismic survey not less than 1,000 km2; and 100% funded additional costs including mapping historic seismic.
In order to retain its 65% interest Tullow must now fully fund one exploration well at no cost to Pancontinental.
“Tullow has to date fully carried out the agreed programme and Pancontinental is optimistic that Tullow will continue exploration on the blocks and proceed towards drilling,” Pancontinental said in a statement.
Licence EL 0037 Petroleum exploration licence 0037 (EL 0037) covers 17,295 sq km (4.2 million acres) in water depths extending to 1,800m in the Walvis Basin offshore northern Namibia.