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Buffalo project farm-out completed

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Oilfield Technology,

Carnarvon Petroleum has said that the farm-out of the Buffalo project offshore East Timor to Advance Energy has been completed.

On 17 December 2020, Carnarvon announced that Advance Energy will acquire 50% of the Buffalo project by funding the drilling of the Buffalo-10 well up to US$20 million on a free carry basis. Advance has met this funding requirement and now has a 50% interest in the project.

The Buffalo-10 well is on track to be drilled in late 2021, subject to securing a drilling rig, where the tendering process is already underway.

Following the well, the joint venture will acquire development funding from third party lenders and any additional funding requirements (in addition to that provided by third party lenders) will be provided by Advance as an interest free loan.

Carnarvon Managing Director and CEO, Adrian Cook, said: “The completion of this transaction is fantastic news for Carnarvon and Advance Energy and now we look forward to drilling the Buffalo-10 well later this year.

The joint venture will move to develop the field quickly to take advantage of the strengthening oil markets. This will be achieved by suspending the well as a future production well and commencing early development studies during 2021.

The Buffalo field has the advantage of being in shallow water which enables a low cost project. This together with the certainty of the fields historical production characteristics enables a fast track timetable and makes Buffalo an exciting project for Carnarvon shareholders.”

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