(Alliance News) - Genel Energy PLC on Monday announced the signing of a farm-out agreement with OPIC Somaliland Corp, for the SL10B13 block, onshore Somaliland.
OPIC Somaliland is a company backed by CPC Corp, a Taiwanese state owned petroleum and gasoline company.
Under the agreement, OPIC will pick up a 49% working interest in return for a cash payment equal to 49% of Genel's historic back costs, in addition to a cash premium.
Genel will remain as operator for the block, which has multiple stacked prospects of over 5 billion barrels of prospective resources.
The field partners will cooperate to plan exploration drilling for the block, and are aiming to drill a well in 2023 which is expected to have a gross cost of USD40 million.
The agreement has already been approved by Somaliland's government.
"Somaliland is a highly-prospective and largely unexplored region, with a compelling technical case for the drilling of a well. Oil seeps confirm a working petroleum system, and one prospect alone could target over half a billion barrels across multiple stacked reservoirs. Being able to drill this at a low-cost to Genel, with a clear route to market in a success case, fits with our strategy, and we look forward to working with OSC," said Technical Director Mike Adams.
Shares in Genel Energy were down 1.0% at 122.40 pence on Monday morning in London.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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Genel Energy (GENL)