First Oil Field Discovered Off The Coast Of Senegal

Partners in the SNE Field, Offshore Senegal, Submitted the Development and Exploration Plan to the Government with the Desired Approval Still This Year

A Joint Venture comprises Cairn as the current operator with 40% Working Interest (WI) along with partners Woodside 35% WI, FAR Ltd 15% WI, and Senegal National Oil Company, Petrosen 10% WI (Petrosen has the right to increase its stake to 18% in development).

The Australian Woodside gained entry into the SNE project in 2016 after buying a 35% stake from ConocoPhillips. In 2017, Woodside became the development lead for the SNE Field Development-Phase 1, with plans to transition to the operator of the RSSD blocks containing the SNE field during 2018.

Cairn announced on Thursday that Woodside has already exercised its option to become the operator of the SNE field development. Work is already underway to facilitate the operator transfer, which is now only subject to government consent.

First Oil in 2022

The development and exploration plan outlines the entire multi-phase development of oil and gas. The field will be developed in a series of phases with plans for about 500 million barrels of oil (mmbbl) and gross production of 100,000 barrels of oil per day (bopd) with first oil targeted in 2022. Following the establishment of oil production, commercial gas sales to Senegal are expected to begin.

Responses to the tender for the FPSO installation and supporting subsea infrastructure have been received and are being evaluated, ready for the planned Front End Engineering Design (FEED) later this year. In parallel with detailed engineering work, an Environmental and Social Impact Assessment study has been submitted to the National Technical Committee.

The presentation of the plan coincides with the opening today of the MSGBC conference for the oil and gas industry in Dakar, Senegal.

FAR’s Managing Director, Cath Norman, said: “The presentation of the development plan for SNE is a major milestone for our company. Since the PND discovery four years ago, FAR has participated in three more oil discoveries in Senegal and successfully drilled 7 PND appraisal wells at a 100% success rate for the 11 wells. SNE was the world’s largest oil discovery for 2014 and, importantly, the first offshore oil field discovered on the shores of Senegal.”

Norman added: “We look forward to seeing this progress in the development of first oil in 2022 and first gas around 2024”.

FAR Arbitration

It is worth noting that FAR objected to the 2016 sale of ConocoPhillips’ 35% stake to Australian Woodside, claiming that the completion of the transaction between ConocoPhillips and Woodside was subject to the partners’ rights of preemption and the approval of the Senegalese government.

Therefore, FAR in June 2017 filed a request with the International Chamber of Commerce in Paris to initiate arbitration proceedings to resolve the current dispute regarding the Joint Operating Agreement concerning FAR’s right to preemptively sell ConocoPhillips’ interest in the Rufisque, Sangomar, and Sangomar Deep Joint Venture offshore Senegal.

FAR stated at the time that the arbitration process and cost structure should take less than a year to conclude, with the expected cost for FAR being around US $1 million.

Following the appointment of the tribunal president in April 2018, the parties resolved the terms of reference and respective procedural documents.

By the end of July this year, FAR stated: “Current indications are that it is unlikely a final hearing in the arbitration will occur before the second half of 2019, pending the parties formalizing their respective positions and undergoing various preliminary hearing procedures.”

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