Edinburgh-based exploration firm Cairn Energy has set its sights firmly on Senegalese exploration for 2015, following its oil strikes in the basin in 2014.
The firm says it is preparing a 2015, operated, multi well evaluation program offshore Senegal, including exploration and appraisal drilling, as well as post well analysis of the SNE-1 and FAN-1 discoveries.
Cairn hit oil on the FAN-1 well offshore Senegal in October 2014 using the Cajun Express semisubmersible drilling rig in 1100m water depth.
Initial gross STOIIP estimates for the FAN-1 well range from P90, 250 MMbbls, P50, 950 MMbbls to P10, 2500 MMbbls and were broadly in line with pre-drill STOIIP estimates
The following month, Cairn struck oil on the SNE-1 well, using the same rig, in similar water depths. Preliminary estimates of the contingent resource ranged from P90, 150 MMbbls, P50, 330 MMbbls and P10, 670 MMbbls recoverable.
Cairn Energy CEO Simon Thomson said the discoveries were play openers and that 2015 would see the company focus on further proving the basin.
“Our focus in 2015 is on delivering a multi well appraisal and exploration program in Senegal, following our success in opening up this new Atlantic Margin basin last year," he says. "The large acreage position in Senegal offers material near term growth potential with numerous follow on prospects identified, and the joint venture is well positioned to benefit from the current reduction in industry costs.”
Cairn is fully funded to deliver its exploration and appraisal program. It is also investing in the UK North Sea Kraken and Catcher developments, in which it is a partner and which are on track for first oil in 2017.
Cairn has US$869 million in cash, as well as an undrawn $575 million seven-year reserve based loan. It is due to complete the sale of 10% interest in the Catcher project in the UK North Sea. The save cash, the group has also reduced its staffing by 40%.
A dispute with Indian authorities over tax payments is ongoing. Cairn Energy still holds 10% interest in Cairn India.
Cairn is also participating in an exploration well on the Cap Boujdour contract area, operated by Kosmos. It is due to drill an appraisal well on the Spanish Point discovery offshore Ireland in 1H 2015.
In addition, it has a program of non-operated wells in North Sea: West of Kraken, UK North Sea (EnQuest operator, Cairn 25% WI), currently operating, and Crossbill, Norwegian North Sea (Wintershall operator, Cairn 20% WI), due in Q1 2015. Additional non-operated wells for 2015 remain subject to final investment decision by partners.
First steel cutting of Catcher FPSO hull started in H1 2015 and development drilling is scheduled to start in H2 2015, following installation of the first phase of subsea drilling templates.
Kraken development drilling is due to start at the end of H1 2015. FPSO construction for the project continues in Singapore and fabrication of the main process modules has started