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(Alliance News) - French energy giant Total SA said Monday together with its partners Equinor PLC, Exxon Mobil Corp and BP PLC, it has signed an agreement with national oil, gas and biofuels agency ANPG and state-owned Sonangol of Angola, to extend all Block 17 production licenses to 2045.
As part of the agreement, Sonangol will obtain a 5% interest in Block 17 on the effective date and an additional 5% interest in 2036.
Additionally, the consortium will pay some production bonuses to the State of Angola along the life of the license and will spend USD20 million for social programs.
Located 150 kilometres off the Angolan coast in water depths ranging from 600 to 1,400 meters, Block 17 "has been a true success story", with almost 3 billion barrels of oil produced since 2001 by four floating production, storage and offloading unit.
"Currently producing around 440,000 barrels of oil equivalent per day, the potential of this very prolific block is still high, with more than 1 billion barrels yet to be produced," the company said.
Patrick Pouyanne, chair & chief executive officer of Total, said: "We are very pleased to continue the Block 17 success story in Angola."
"This golden block has allowed us to demonstrate our deep offshore excellence over the past 20 years with numerous technological developments and innovations," Pouyanne said.
In another statement, Total said it has also signed a sale and purchase agreement with Sonangol to acquire interests in Blocks 20/11 and 21/09 in the Kwanza Basin, offshore Luanda.
Under the agreement, the company will hold a 50% working interest, alongside Sonangol's 20% and BP's 30%, in Block 20/11, located in the central Kwanza Basin in water depths ranging from 300 to 1,700 meters.
Total will also hold an 80% working interest alongside Sonangol's 20% in Block 21/09, located in the south-central Kwanza Basin in water depths ranging from 1,600 to 1,800 meters.
As part of the agreement, Total will become operator of the development of the two licenses before putting in place an operating company together with Sonangol 3 years after the production start-up, the company said.
As per the transaction terms, Total will pay to Sonangol USD400 million at closing, to which will be added USD100 million at final investment decision and some additional payments along the life of the project depending on production and crude oil price for a maximum cumulative amount capped at USD250 million.
Total shares closed 1.0% higher in Paris at EUR48.28 each on Monday.
By Loreta Juodagalvyte; loretajuodagalvyte@alliancenews.com
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