Rockhopper Exploration plc said it was in discussions with potential partner Navitas Petroleum LP after Harbour Energy plc decided against proceeding with the Sea Lion project in the North Falkland Basin.
HARBOUR
In its interim results published today, Harbour said it had undertaken a thorough review of the Sea Lion project in which it has a 60% operated interest.
“While the Sea Lion discovery has significant resource potential, development of the project is not deemed a strategic fit for Harbour,” said the company.
“Therefore the group has decided to explore the options to exit the project and its other licence interests in the Falkland Islands.”
NAVITAS PETROLEUM
Navitas and partners have recently raised project financing in excess of $900 million.
The company has also taken a final investment decision on the 330 million barrel deep water Shenandoah project in the US Gulf of Mexico.
SEA LION
Rockhopper discovered and appraised the Sea Lion project which has independently audited 2C resources in excess of 500 million barrels.
“The previously announced heads of terms with Premier Oil and Navitas will expire on 30 September 2021 (unless extended by mutual consent before that date),” said Rockhopper in a statement.
“If the heads of terms expire, Harbour will have an initial 90 days to elect how to proceed with their exit.
“Rockhopper will continue to be funded (excluding licence fees, taxes and project wind down costs) by Harbour during that period.”
FUNDING
Chief executive Sam Moody added that Harbour’s decision represented both a difficult moment and a huge opportunity for Rockhopper.
“Whilst we are disappointed that Harbour has decided to not to proceed with Sea Lion, we remain committed to unlocking its development.
“Navitas’ recent financing on its Shenandoah project demonstrates that funding remains available to independent E&Ps in the international markets for large-scale offshore oil developments and we very much look forward to working with them to progress Sea Lion.”