The Ministry of Mines and Hydrocarbons of Equatorial Guinea and Kosmos Energy have signed three new production sharing contracts (PSC) for Block EG-21, Block S and Block W offshore Rio Muni, marking Kosmos first PSCs in Equatorial Guinea
Block EG-21 was offered for tender during the EG Ronda 2016 oil and gas licensing round. Block S and Block W were previously operated by CNOOC and PanAtlantic Energy respectively. They were negotiated directly with Kosmos and were not offered under the open bidding round. Block EG-21 covers 2,495 sq kms, Block S covers 1,245 sq kms and Block W is 2,254 sq kms. In each block, Kosmos will hold an 80 per cent stake and GEPetrol will control the remaining 20 per cent.
Minister of Mines and Hydrocarbons Gabriel Mbaga Obiang Lima said: “Kosmos Energy has demonstrated extraordinary and consistent success in frontier exploration projects in West Africa. We trust Kosmos will bring important knowledge and technology to Equatorial Guinea, an established oil and gas producer in Africa with proven potential. We look forward to working with Kosmos as we continue to push the boundaries in oil and gas exploration.”
The PSCs for the block is based on Equatorial Guinea’s model PSC, and stipulate minimum work programmes that comprise a first exploratory period of three years, which include acquiring seismic data; a second exploratory period of two years, which includes drilling an exploratory well; and the possibility of two one-year extensions, which include requirements to conduct seismic interpretation and drill another exploration well, respectively. The PSC also stipulates spending on local content and social responsibility.
