Award of three blocks in Brazil’s 11th Round to Premier Oil plc
Premier is pleased to announce that it has been awarded three blocks in Brazil’s 11th Round held in Rio de Janeiro on 14 May. The blocks are located in deep water basins offshore North East Brazil in largely under-explored areas and contain prospects and leads capable of delivering between 250 mmbbls and 1 bn bbls each.
Premier was awarded a 50 per cent operated equity stake in Blocks 717 and 665 in the Ceara basin. The Ceara basin is a Cretaceous rift basin with a proven oil source rock. In Block 717, two plays will be pursued: a potential extension of the Pecem discovery south into the block and a slope channel play which will require additional 3D seismic to mature to drillable status. In Block 665 a large Cretaceous onlap play has been identified. A block-wide 3D seismic survey will be acquired to assess this opportunity in 2014.
Premier was also awarded a 35 per cent non-operated equity stake in Block 90 in the Foz do Amazonas basin. This block provides Premier with access to a high impact Cretaceous exploration play proven across the border in French Guiana. Specifically, stratigraphic traps onlapping a rift basin high will be targeted. The forward plan is to acquire 3D seismic in 2014.
In respect of the licence awards, Premier will pay a total of $24.5 million in signature bonuses and expects to invest approximately $25 million in 3D seismic data acquisition. Well commitments include one exploration well in Block 90 and two exploration wells in Block 717 at an estimated total net cost to Premier of $100 million. Premier will fund the cost of this work programme from within its planned exploration spend.
Simon Lockett, Chief Executive Officer, commented:
“We are extremely pleased with the outcome of the bidding round in Brazil which demonstrates Premier’s ability to successfully compete for world class exploration opportunities and further increases the materiality of our exploration portfolio.”
SOURCE: Premier Oil plc
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