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September 20, 2019 | Australian, The/Weekend Australian/Australian Magazine, The (Australia) Author: EDITED BY BRIDGET CARTER | Page: 22 | Section: Business 444 Words Read News Document Listen with webReader FAR Limited is understood to have called off plans to offload a stake in its Senegal development, raising questions how it will fund the project in the African nation.It comes after a flyer was released to the market in March which said Cairn Energy and FAR were considering the sale of up to a 35 per cent aggregate interest in the Rufisque Offshore, Sangomar Offshore and Sangomar Deep Offshore Contract Areas offshore Senegal.Speculation is mounting the group has instead been considering an ambitious bond raising through Credit Suisse, with a plan to secure $US300m ($442m).However, the company has denied this was the case, saying there were no plans to embark on a bond raising.A company spokesman also told the column on Thursday that the company was not selling a stake in the SNE project.That leaves analysts wondering what is next for FAR, with some saying the only options to secure funding were an asset sale, a bond raising or to raise equity. Some believe any equity raising would have to be at a substantial discount.In a statement to the market in June, FAR said it was examining various funding options for its share of its upcoming SNE oilfield development off the coast of Senegal, with the sole focus of its strategy being to maximise total shareholder returns.A potential sale was “only one option available”, the company said at the time, and that was being considered by the board along with other forms of financing.Working on the sale of the Senegal project was advisory firm Jefferies. The understanding was bids were due on June 10.The SNE development, off the coast of Senegal in West Africa, has an overall value of $US3bn ($4.4bn).It is 15 per cent-owned by FAR. Cairn Energy owns about 40 per cent, and it is understood the market was sounded out about buying about a 30 per cent stake in the project to fund the plan.The other owners are the operator, Woodside, which holds 35 per cent, and Petrosen, the Senegalese national oil company, with 10 per cent.FAR has been in arbitration with ConocoPhillips over the sale of Senegal assets, where ConocoPhillips offloaded its interest in the SNE project in 2016 to Woodside for $US430m.The dispute centres on FAR’s right to pre-empt the sale of the interest. When it reported its results last month the company said that the arbitration hearing against Woodside had taken place and a tribunal ruling was expected by the end of the year.The SNE deepwater oilfield discovery is offshore, 100km south of Dakar. It was the largest oil discovery for 2014 and production was initially targeted for 2022. Capacity is estimated at 100,000 barrels a day.
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