Europa Oil & Gas (Holdings) plc investee, Antler Global Ltd, has secured a 40% farm-out to Fuhai (Beijing) Energy Ltd to drill the EG-08 block, offshore Equatorial Guinea.
RESOURCES
Fuhai, a subsidiary of Chinese energy and chemical business Fuhai Group New Energy Holding Co. Ltd, will fund 95% of the total costs, up to $53 million (£39m), to drill and test a well on the Barracuda prospect.
Operator Antler will pay the balance of 5% and is targeting operations to start during 2026.
Europa, which holds 42.9% of Antler, said that EG-08 contained prospective resources of 2.213 trillion cubic feet, of which 380 billion cubic feet equivalent is net to Europa.
Barracuda holds Pmean of gross unrisked prospective recoverable resources of 893 billion cubic feet equivalent hydrocarbons (bcfe).
Other prospects include Cardinal with 275bcfe; Arrowhead, 324bcfe; Dentex, 259bcfe; Northern, 118 bcfe; and four other prospects 344bcfe.
Following the farm-out, Antler will hold a 40% working interest in the EG-08 production sharing contract; Fuhai, 40%; and national oil company GEPetrol (Guinea Equatorial de Petróleos), 20%.
The agreement is subject to consent from the Ministry for Mining and Hydrocarbons Department of Equatorial Guinea, and Overseas Direct Investment from the Shandong Provincial government.
Europa chief executive officer William Holland added: “Although the deal is still subject to MMHD and ODI approval, we are confident that this will be secured within the coming months and as such have now entered a period of detailed engineering and procurement in order to spud the well as soon as possible.
“The signing of the farm-out agreement with Fuhai is the culmination of three years of hard work to first identify the opportunity at EG08 and then, working as one team with Antler, to work up the prospectivity of the EG08 block then to secure an excellent partner to carry us through drilling.
“The farm-in is without question a great result for Europa and equates to a 2.38 for 1 carry which reflects the quality of the asset, namely the high chance of success and the size of the resource potential.”
Mr Holland is a director of Antler, along with co-founder Paul Haywood, who is chief executive of Block Energy plc, which focused on oil exploration, development and production in Georgia.