Cairn sells part of Sangu stake to Australian co
Saturday, 27 October 2007
FE Report
Scottish oil company Cairn Energy has sold part of its stake of its Sangu gas field to Santos Ltd., Australia's third-biggest oil and gas producer, for US$50 million, said a report received in Dhaka Friday.
The sale includes the disposal of Cairn's 37.5 per cent interest in the Sangu Development Area, its 37.5 per cent interest in Block 16 exploration acreage, and its 45 per cent interest in exploration Blocks 5 and 10.
It will also include contingent payments of $20 million, payable in installments depending on future development results from the current drilling programme. Cairn's subsidiary Capricorn Energy will dispose of Cairn Energy Bangladesh Limited stake to Santos International.
Edinburgh-based Cairn continues to hold interests in the licences and will remain as operator.
Cairn said proceeds of the transaction will be used to fund its ongoing exploration activities in the Magnama offshore Block 16 October 3.
The company has started drilling at a shallow depth in Magnama structure, some 12 kilometers from the Kutubdia Island in the Bay of Bengal. It will invest US$117 for drilling wells in offshore fields -- Megnama and Hatiya -- in the current winter season.
If the result of the exploratory works in Megnama gas field, having the area of 73 square kilometers, becomes positive, the company will drill an appraisal well in the same structure to assess the recoverable reserves of hydrocarbon there.
Cairn will subsequently drill production well in Megnama structure to initiate gas production.
If the drilling at Megnama shows negative result, the company will go for drilling exploratory well at Hatiya structure under the same block, sources said.
Cairn Energy completed 3D seismic surveys in both Megnama and Hatiya in 2005 last having the indication of gas reserves to the tune of 3.5 trillion cubic feet (Tcf) and 1.8 Tcf respectively in those structures.
To conduct drilling in Megnama and Hatiya structures, Cairn has rented a brand new rig from a Norwegian company.
Cairn has been in Bangladesh for more than 10 years.
It has stakes in blocks 5, 7, 10 and 16 to conduct hydrocarbon exploration in the country.
Scottish oil company Cairn Energy has sold part of its stake of its Sangu gas field to Santos Ltd., Australia's third-biggest oil and gas producer, for US$50 million, said a report received in Dhaka Friday.
The sale includes the disposal of Cairn's 37.5 per cent interest in the Sangu Development Area, its 37.5 per cent interest in Block 16 exploration acreage, and its 45 per cent interest in exploration Blocks 5 and 10.
It will also include contingent payments of $20 million, payable in installments depending on future development results from the current drilling programme. Cairn's subsidiary Capricorn Energy will dispose of Cairn Energy Bangladesh Limited stake to Santos International.
Edinburgh-based Cairn continues to hold interests in the licences and will remain as operator.
Cairn said proceeds of the transaction will be used to fund its ongoing exploration activities in the Magnama offshore Block 16 October 3.
The company has started drilling at a shallow depth in Magnama structure, some 12 kilometers from the Kutubdia Island in the Bay of Bengal. It will invest US$117 for drilling wells in offshore fields -- Megnama and Hatiya -- in the current winter season.
If the result of the exploratory works in Megnama gas field, having the area of 73 square kilometers, becomes positive, the company will drill an appraisal well in the same structure to assess the recoverable reserves of hydrocarbon there.
Cairn will subsequently drill production well in Megnama structure to initiate gas production.
If the drilling at Megnama shows negative result, the company will go for drilling exploratory well at Hatiya structure under the same block, sources said.
Cairn Energy completed 3D seismic surveys in both Megnama and Hatiya in 2005 last having the indication of gas reserves to the tune of 3.5 trillion cubic feet (Tcf) and 1.8 Tcf respectively in those structures.
To conduct drilling in Megnama and Hatiya structures, Cairn has rented a brand new rig from a Norwegian company.
Cairn has been in Bangladesh for more than 10 years.
It has stakes in blocks 5, 7, 10 and 16 to conduct hydrocarbon exploration in the country.