KUALA LUMPUR (Oct 29): Hibiscus Petroleum Bhd today announced that its wholly-owned subsidiary, Carnarvon Hibiscus Pty Ltd (CHPL), has signed a rig share agreement with Origin Energy Resources Ltd, for the drilling of an exploration well located offshore Australia.
“Under the agreement, CHPL will assume the services of the Seadrill West Telesto drilling rig, an independent leg cantilever jack-up rig, to spud and drill the Sea Lion (VIC/P57) exploration well after the Origin Energy’s drilling activities,” HPB says in its press release today.
Origin Energy intends to drill two wells before handing over the rig, which owned by Seadrill Ltd, to CHPL.
Seadrill Ltd is an international drilling contractor that is listed on both the Oslo Stock Exchange and New York Stock Exchange.
Hibiscus Petroleum says the drilling of Sea Lion exploration well is estimated to take up to 30 days; while provides CHPL with an option to drill two other development wells called West Seahorse immediately following Sea Lion.
According to the special purpose acquisition company (SPAC), the agreement with Origin serves for several reasons, including significant savings gained for sharing of the mobilisation and demobilisation costs, certainty of the rig’s availability period, strong past operating performance, crew competence and good health, safety and environment record.
“After months of planning, we are excited to get our drilling program in VIC/P57 underway. If successful, Sea Lion would be developed as a tie-back to West Seahorse, fully utilizing the planned West Seahorse facilities and providing a cost effective solution for the development of Sea Lion,” said the SPAC’s managing director Dr Kenneth Pereira in the press release.
CHPL currently has a 50.1% participating interest in VIC/P57, while the balance is held by 3D Oil Limited (3D Oil).
There were various agreements signed between CHPL, 3D Oil and Hirex Petroleum Sdn Bhd (a 41% jointly controlled entity of Hibiscus Petroleum) on July 4 this year, CHPL will acquire an additional 5% interest in the Sea Lion (VIC/P57) exploration well whilst Hirex has an option to acquire a 20% interest in VIC/P57 exploration permit from 3D Oil.
“The completion of these transactions is pending the satisfaction of certain condition precedents,” says the SPAC.
Drilling of the Sea Lion exploration well is expected to commence in second quarter of 2015, with estimated prospective resources of about 11 million barrels.
Hibiscus Petroleum rose two sen or 1.65% to close at RM1.23 today with 208,400 shares transacted, giving it a market capitalisation of RM1.09 billion.