Far to Exit Offshore Senegal Blocks
Australian player Far has agreed to sell its interest in the production-sharing agreement (PSA) governing the Rufisque, Sangomar and Sangomar Deep (RSSD) blocks offshore Senegal to Indian state oil group ONGC for $45mn, it said on November 11.
The deal covers Far's 13.7% interest in the Sangomar exploitation zone containing the Sangomar field and its 15% position in the surrounding RSSD contract zone. ONGC has also agreed to reimburse FAR's share of working capital for the RSSD project from January 1, totalling $66.6mn. The sum comprises not only capital calls but also $29.6mn Far was charged for defaulting on payments.
The transaction also includes contingent payments up to a $55mn cap. Far is targeting its completion by the end of January, after standard approvals have been secured and the project's current partners waive their rights.
The PSA for RSSD is operated with a 35% stake by Australia's Woodside Petroleum, which recently agreed to acquire a 40% interest from Cairn as well, using its pre-emptive right after Russia's Lukoil made a bid. Senegal's state-owned Petrosen is also a project partner.
The group took a final investment decision on the development in January. Production is due to start in 2023 and reach 100,000 barrels/day. While a mostly oil-focused project, the partners also want to transport its gas to shore.
"Having been in the RSSD project for 14 years, it’s a bittersweet moment to be selling our stake," Far's managing director Cath Norman said in a statement. "Far is committed to our projects in The Gambia and Guinea-Bissau and using our deep knowledge of the MSGBC basin to potentially explore offshore Senegal again."