Just found that while searching regarding L6 onshore, not sure if this is already known. No mentioning of a farm-out in L6 offshore, while this was the case in an older article in July (see below)
Australian explorer Far Ltd has announced that it has received a 1 year extension in the PSC term of Block L6 after the company delayed planned activities Government of Kenya due to the inability to access the ground to complete planned seismic operations because of security incidents in the country.
In February 2014, the Group signed a farm-out to Milio E&P Limited and Milio International Limited of Dubai in relation to the onshore part of Block L6, Kenya. Under the terms of the farm-out deal, the Group will be fully carried through the drilling of an onshore exploration well in 2015 and the acquisition, processing and interpretation of a regional 1,000 line kilometre 2D seismic survey.
At the reporting date the conditions precedent of the farm out agreement had not been completed and the parties were negotiating an amendment to the farm-out agreement in light of the implications of the security incidents.
The Group will hold 24% in the onshore area, retains its full 60% interest in the offshore part of Block L6 and remains the operator in the block.
Meanwhile the company says it continues to pursue entry into Block 9 and the plans for future work program and has been in discussions with Dominion Petroleum Kenya Limited.
FAR’s subsidiary, Flow Energy Ltd, was a member of the bidding consortium that made an application bid for Block L9 in 2010.
Following negotiations with the Ministry of Energy and Petroleum, a heads of agreement was signed and Block L9 was subsequently awarded in May 2011.
Far says it is of the view that that the Miocene carbonate reef play, identified in Block L6 extends along the Kenyan coast and into Block L9 and that a future 3D seismic survey over the inboard part of Block L9 would evaluate this potential.
FAR has said it has delayed a planned onshore well and an onshore 2D seismic survey and associated processing and interpretation in Northern part of coast Kenya due to insecurity in the area.
According to a statement from the company the operations which were to start in June has been pushed forward as the company, its partner Milio and the Kenyan Ministry of Energy and Petroleum to monitor the situation and put in place appropriate risk mitigation strategies.
“Security incidents are currently hampering the commencement of the seismic survey to be conducted by Milio and the seismic survey will be delayed until it is safe to enter the area,” says the company’s management.
FAR which has a net interest of 60% offshore, 24% onshore and is the Operator of the block (farmed out to Milio in February) is however continuing its activities offshore and is currently progressing a farm out initiative for drilling an offshore well.
The company says the recent confirmation of oil in neighboring Block L10A and evidence of oil in the Maridadi well drilled at the northern extent in L6 has raised hopes in the block with a strong industry interest in its L6 farm out opportunity.
“A farm out is progressing to secure funding for the drilling of an offshore well on Block L6. The Company is actively seeking new opportunities in Kenya and the $8 million capital raising was to pursue these opportunities and support working capital requirements.”
The Miocene reef play in block 10A extends along the coast of Kenya and through both of FAR’s offshore blocks, L6 and L9.
In block L9 where Ophir energy is the operator FAR says it is awaiting unconditional Government approval for the Joint Venture agreements in relation to L9.
Following unconditional Government approval, FAR which holds 30% interest in L9 will pay Ophir approximately US$11 million relating substantially to back costs on seismic surveys and also provide funding for a bank guarantee in favour of the Government of Kenya in relation to the Block L9 work commitment.
The Operator plans to drill the first exploration well on Block L9 at the end of 2015.
During the quarter the Operator received a one year extension to the current exploration period. FAR intends to farm out part of its interest for drilling and has already received unsolicited expressions of interest.
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