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- Woodside Petroleum (WPL) has completed its purchase of Capricorn Senegal’s (Cairn) interest in the Sangomar joint venture development in Senegal
- The energy giant bought the interest for US$300 million (around A$396 million) plus a working capital expenditure of US$225 (around A$297 million)
- Woodside now holds just over 68 per cent in the Sangomar exploitation area, however, this could increase to 82 per cent if Woodside buys fellow ASX-lister, Far’s (FAR) interest
- The purchase of an additional interest is expected to be finalised in the first quarter of 2021
- Once completed, the project will be the first offshore oil development in Senegal
- Woodside is up 2.30 per cent and trading at $23.09
Woodside Petroleum (WPL) has completed its purchase of Capricorn Senegal’s (Cairn) interest in the Rufisque Offshore, Sangomar Offshore and Sangomar Deep Offshore (RSSD) joint venture.
Woodside spent US$300 million (roughly A$396 million) as well as a working capital adjustment of US$225 million (roughly A$297 million) for the purchase. Additional payments of up to US$100 million (roughly A$132 million) are dependent on oil prices and timing of first oil.
The RSSD joint venture is for the Sangomar field development and is located 100 kilometres south of Dakar, Senegal.
RSSD joint venture partners include Far (FAR) and Senegal’s national oil company Petrosen.
With this new interest, Woodside now holds just over 68 per cent in the Sangomar exploitation area and 75 per cent of the remaining RSSD evaluation area. However, the energy giant is wanting more.
It is also aiming to purchase Far’s interest, which is expected to be completed in the first quarter of 2021. With Far’s interest, Woodside will own 82 per cent of the Sangomar region and 90 per cent of the RSSD area.
Sangomar covers an area of 7490 square kilometres within the Senegalese portion of the Mauritania Senegal Guinea Bissau Basin. It is said to be one of the world’s largest oilfields found over the last decade.
Once completed, the project will be the first offshore oil development in Senegal. Work has already commenced at Sangomar, which Woodside is expecting to reach production by 2023.
In January, the company received the greenlight for the oil field development from the Senegalese Government.
Woodside CEO Peter Coleman said the purchase of Cairn’s interest in the Sangomar project area offshore Senegal was valuable for shareholders.
“The development of Sangomar is being executed according to schedule. The Senegal team recently achieved another milestone, with the award of the contract for the operations and maintenance of the floating production storage and offloading vessel which is targeted for delivery and first oil production in 2023,” he said.
“The completion of the transaction with Cairn has simplified the structure of the joint venture ahead of our planned equity sell-down in 2021. The Sangomar development is an attractive, de-risked asset that offers near-term production to potential buyers,” he added.
Woodside is up 2.30 per cent and trading at $23.09 per share at 10:24 am AEDT.
