JuaKali
JF-Expert Member
- Nov 14, 2007
- 776
- 118
LONDON, Sept 11 (Reuters) - Dominion Petroleum Ltd on Thursday said it had agreed to farm out 50 percent of its interest in the Mandawa production sharing agreement (PSA), onshore Tanzania to Etablissements Maurel et Prom SA.
Maurel & Prom will contribute to Dominion's past exploration costs at the 6,811 square kilometre license area and also pay an equal share of forward exploration costs, including those of the two wells that must be drilled under the PSA.
The company said it expects to drill the first of these wells, Mihambia-1, in the fourth quarter of 2008.
Analyst Tim Heeley at brokerage Daniel Stewart said the agreement was not on the most amazing terms, but nonetheless it reduced Dominion's costs whilst not overtly affecting the value of its growing portfolio.
'With the Mihambia-1 well expected to spud in Q4, a rig has been secured through an M&P subsidiary, news flow will begin for Dominion from this increasingly significant hydrocarbon province,' he said in a note.
Maurel & Prom will contribute to Dominion's past exploration costs at the 6,811 square kilometre license area and also pay an equal share of forward exploration costs, including those of the two wells that must be drilled under the PSA.
The company said it expects to drill the first of these wells, Mihambia-1, in the fourth quarter of 2008.
Analyst Tim Heeley at brokerage Daniel Stewart said the agreement was not on the most amazing terms, but nonetheless it reduced Dominion's costs whilst not overtly affecting the value of its growing portfolio.
'With the Mihambia-1 well expected to spud in Q4, a rig has been secured through an M&P subsidiary, news flow will begin for Dominion from this increasingly significant hydrocarbon province,' he said in a note.
