TotalEnergies has signed a farm out agreement to sell a 40 percent participating interest in block OPL257, offshore Nigeria, to South Atlantic Petroleum, known as SAPETRO. On completion TotalEnergies will hold a 50 percent operated interest, SAPETRO 40 percent and Conoil the remaining 10 percent. Financial terms were not disclosed, and completion is subject to customary conditions including Nigerian regulatory approvals.
OPL257 lies about 150 kilometres offshore and covers about 370 square kilometres. It borders PPL261, where TotalEnergies holds 24 percent and where TotalEnergies and its partners, SAPETRO among them, discovered the Egina South field in 2005. The field straddles both blocks, so the OPL257 side must be appraised before its size and commerciality can be established. SAPETRO has put the potential at up to 140 million barrels, according to Oil and Gas Journal reporting of the announcement.
An appraisal campaign on the OPL257 side is planned in the coming months. If it succeeds, the partners intend to develop Egina South as a tie back to the Egina floating production, storage and offloading vessel, about 30 kilometres away, avoiding the cost of a standalone facility. Mike Sangster, TotalEnergies’ senior vice president for Africa exploration and production, said consolidating the long term partnership paves the way for a quick appraisal campaign and subsequent development in the success case.
The deal fits a wider pattern in West African deepwater: international majors keep operatorship and a majority of the upside while local partners take a larger share of early stage exposure, and development is routed through existing vessels to keep costs and emissions per barrel low. No closing date, appraisal start date or development decision has been given.