AWE Limited announced that it has signed a farm-in agreement to acquire a 40% working interest in Block 09/05, offshore Bohai Basin, China, from a subsidiary of ROC Oil Company Limited.
The block is located in the western part of the Bohai Bay Basin in China, approximately 10 km southeast of Tanggu, the largest port in China. The block covers an area of 335 km2, with water depths from approximately 5 – 10 m. It also has the benefit of low drill and development costs, proximity to existing infrastructure and attractive fiscal terms.
Under the terms of the agreement, AWE will pay ROC US$ 2 million for past costs, 60% of the first exploration well and 54% of the second. If drilling costs exceed the initial gross estimate of US$ 14.7 million per well, AWE will contribute at a 40% working interest.
The first exploration well, QK11-1-1, was spudded on 14 August and will test a low risk, material size prospect that is covered by recently acquired 3D seismic survey data.
Commenting on the agreement, AW Managing Director, Bruce Clement, said: “This farm-in represents an important milestone and provides an ideal platform to expand into China. The opportunity is consistent with AWE’s exploration strategy to strengthen our prospect inventory by adding quality acreage within the Asia region. AWE believes that the partnership with ROC (an established operatory within China) will provide mutual benefits to both companies.”
Adapted from press release by Katie Woodward
Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/18082014/awe-acquires-interest-in-block-offshore-china-1286/