Sterling Energy Plc has announced it has agreed with its partners in the Ntem Concession, offshore Cameroon to lift force majeure and proceed with exploration.
The Ntem Concession has been under force majeure since June 2005 as a result of overlapping maritime border claims by the Republic of Cameroon and the Republic of Equatorial Guinea. The border claims remain unresolved but the joint venture partners, Sterling Cameroon Limited (“Sterling”) and Murphy Cameroon Ntem Oil Co., Ltd (“Murphy”), have now agreed, with Société Nationale des Hydrocarbures (“SNH”), the national oil company of Cameroon, to formally lift the declaration of force majeure in order to allow exploration activities to proceed.
The current exploration period (the “First Renewal Period”) re-commenced on 22 January 2014 with a minimum work obligation of one exploration well in the remaining 15 months.
The Ntem Concession is a large, undrilled block, in water depths ranging from 400m to 2000m, in the highly prospective southern Douala – Rio Muni Basin, offshore Cameroon. In November 2011, Sterling signed a farm-out agreement with Murphy (a wholly owned subsidiary of Murphy Oil Corporation) under which Murphy was assigned a 50% working interest in, and operatorship of, the Ntem Concession. Sterling retained a 50% non-operated working interest. As part of the consideration for the farmout, Murphy will pay Sterling’s share of the costs for drilling the first well.
Murphy has contracted the Ocean Confidence drill ship which is being prepared for mobilisation to the Ntem Concession. The Bamboo-1 well will be the first exploration well drilled on the Concession. It is located in approximately 1600m of water and will drill a series of vertically stacked, Cretaceous aged, submarine fans, defined using the extensive 3D seismic data set that covers more than 70% of the concession area; Sterling estimates that the primary objective may contain mean un-risked, gross prospective resources of 422 million barrels of oil and 170 billion cubic feet of gas, a total of some 450 million barrels of oil equivalent.
The Bamboo #1 well location is outside the disputed area subject to the maritime border claims of Cameroon and Equatorial Guinea.
The Bamboo-1 well is expected to spud in February 2014.
Sterling Energy Plc.’s Executive Chairman, Alastair Beardsall, said: “We are very pleased to lift force majeure and commence the drilling of an exploration well on the highly prospective Ntem Concession; the Bamboo #1 well will target mean un-risked, gross prospective resource of some 450 million barrels. We are very excited to move forward with an exploration programme on this highly prospective block.”