Oando Energy Resources Inc., Calgary, through its 81.5%-held subsidiary Equator Exploration Ltd., has executed a production-sharing contract (PSC) with the National Petroleum Agency of Sao Tome and Principe (ANP-STP) for Block 12 in the Exclusive Economic Zone, taking an 87.5% participating interest. ANP-STP holds the remaining 12.5% as a carried interest.
The Oando unit then farmed out a 65% participating interest and transferred operatorship in each of Blocks 5 and 12 to Kosmos Energy Sao Tome and Principe.
The Block 5 farmout transaction was approved by ANP-STP on Feb. 19 and the Block 12 farmout transaction was approved on Mar. 31.
Oando Energy Resources focuses on oil and gas exploration and production in Nigeria and the Gulf of Guinea
Prior to the Block 5 farmout transaction, Equator held an 85% participating interest in the PSC for Block 5, with ANP-STP holding the remaining 15% as a carried interest. The PSC was signed in April 2012 and a 3D seismic survey of 1,480 sq km was acquired in April 2015. After completion of both farmouts, the parties hold the following interests: Block 5, Kosmos 65%, Equator 20%, and ANP-STP 15%; and Block 12, Kosmos 65%, Equator 22.5%, and ANP-STP 12.5%.
Block 5 covers an area of 2,844 sq km in 2,000-2,500 m of water. It was ranked highest in the EEZ by Equator with regard to hydrocarbon potential based on water depth, proximity to both the Equatorial Guinea shelf and the ancient Ogouee delta, and the presence of structural development related to basement faulting in the Cretaceous where oil has been found in Equatorial Guinea.
Block 12 has an area of 7,940 sq km in 2,500-3,000 m of water. The block is situated within Zone B of the government block classification scheme, and within this group has been ranked the most attractive by Equator due to its proximity to the North Gabon salt basin and the presence of structural prospects both on the footwall of the Ascension Fault and similar sub-parallel trends.