Cairn Energy exploration director Richard Heaton said the third well would target the Bellatrix prospect, which 3D data processing suggests also overlies the northern end of the SNE field. The company attributed the widened loss to a $177.1 million impairment charge. The large USD177.1 million impairment relates to the dwindling value of the subsidiary.
The bank said net cash was also below both its and consensus expectations of $780m. The firm also plans to begin drilling offshore Senegal in the acreage around the SNE-1 discovery well in the fourth quarter.
The joint venture submitted a three year evaluation work programme to the Government of Senegal in early May 2015 which the Operator announced has been agreed by the Government of Senegal.
Edinburgh-based oil and gas explorer Cairn Energy has secured government clearance for a major drilling programme off Senegal in West Africa.
Cairn and its partners and now finalizing its exploration program targets for three firm appraisal and exploration wells, using the 7th generation Ocean Rig Athena drillship; with plans to core and test the appraisal wells. Our aim is to maximize the value of our Senegal asset within a balanced, well-funded company. “Cairn is well placed to take advantage of this exciting opportunity as we build on the success of last year’s discoveries”, Thomson added.
Cairn has been prevented from selling its remaining 10 per cent stake in Cairn India Ltd while the tax bill remains in dispute, though the company notes in a first-half trading update it has now entered into global arbitration proceedings with the government of India. Those projects are still expected to be cashflow generative before the end of 2017. Cairn has a 20% stake in the Catcher development and a 25% stake in the Kraken development.
ConocoPhillips owns 35% and FAR has 15% that include its other partners, while the Senegal National Oil Company Petrosen will retain a 10% interest in the exploration phase, BBC reported.
Cairn had a total of 47.2 million barrels of oil equivalent booked as 2P (proved and probable) reserves as of June 30, 2015.
At 1126 BST, Cairn shares were down 4.7% at 147.20p.