"Oil explorer Fastnet (LON:FAST) today hailed BP’s (LON:BP.) farm-in into offshore Morocco as an “an unequivocal validation by the oil industry” of the region.
BP has done a deal with Kosmos for three blocks offshore Morocco, one of which is Foum Assaka where Fastnet has an 18.75% stake.
BP will take 26.325% non–operating stake in Foum Assaka through the farm-in, with Kosmos’ stake reduced to 29.925%.
The UK giant has also agreed with Kosmos to take sizeable stakes in the Essaouira Offshore and Tarhazoute Offshore licences, which, like Foum Assaka, are situated in the Agadir Basin.
In exchange, BP will fund one exploration well in each of the blocks, pay a proportionate share of past costs and disproportionately pay for the costs of a second well drilled on any of the blocks.
Paul Griffiths, Fastnet’s managing director, said he welcomed the strengthening of the Foum Assaka partnership.
“We view the farm-out as indirectly value-enhancing to Fastnet in that it reduces the industry perception of geological riskfor Foum Assaka.”
He added it will also act as a catalyst to accelerate its own farm-out process, “by underpinning commercial terms that are focused on a farminee paying a disproportionate share of drilling costs."
Brian Maxted, Kosmos’ chief executive, said the group is preparing to start drilling on the licences in the first half of 2014." ---------------------------------------
Well BP farmed into not one but THREE blocks in Morocco with Kosmos. This looks very positive indeed.. However also a little disheartening that they are forking out a large amount of cash for a lesser percentage than what TPT had to fork over.
26.325% for Foum Assaka and 45% each for Essaouira and Tarhazoute. The Essaouira and Tarhazoute blocks are in quite deep water and I'm sure they'll need semi subs to drill, so for a 45% stake and to pay some past back costs whilst paying for a well in each.. That has me thinking TPT definitely got the rough end of the stick. Mind you I don't know the target sizes of those blocks so maybe it's all relative to the prospective resources size.
Either way, there's no point looking at this negatively as when it all boils down, this can only be a positive thing as BP are sure to attract even further attention to the Morocco oil and gas scene. It's ironic how this deal has been made right when the Morocco govt have gotten their act together.. Coincidence or not, lets hope the approvals are here shortly and we can finally focus on the drill date being released!
TPT Price at posting:
20.0¢ Sentiment: LT Buy Disclosure: Held
