Cairn Energy announces significant oil find offshore Senegal

10th Nov 2014 07:33

Oil explorer Cairn Energy on Monday announced a "significant" oil find off the coast of Senegal, with preliminary estimates pointing to commercial viability.The new find was the result of drilling of its new SNE-1 well located approximately 100 kilometres off-shore from the West-African country in the Sangomar block, at a depth of about 3,000 metres.Intermediate logging confirmed the discovery of hydrocarbons in the Cretaceous clastics objective, which is of a similar geological period as the oil bearing sands found about 24 kilometers away at its FAN-1 well.Notices of discovery for the SNE-1 well and FAN-1 well have been issued by Cairn, as operator, on behalf of the joint-venture, to the Government of Senegal.A "very significant" find, analysts sayAn initial analysis revealed a 95m gross oil bearing column with a gas cap. The preliminary estimate of the contingent resource (P90) point to 150m barrels of proven reserves.More significantly, prior to drilling Cairn had estimated that it might find 182 mmbbls of so-called probable (P50) reserves, versus the 330 mmbbls apparently discovered, "implying a significantly larger than expected discovery," Shore Capital analysts Dragan Trajkov and Robin Haworth pointed out."Reservoir quality is said to be 'excellent' although no porosity log data has been released and there has been no flow test," they added. Even so, at this early stage the discovery looks to be "very significant".The deeper target of karstified and fractured Lower Cretaceous shelf carbonates is yet to be reached. A further announcement will be issued once operations are completed on SNE-1, the company added.Cairn has a 40% 'working interest' (WI) in three blocks offshore Senegal (Sangomar Deep, Sangomar Offshore and Rufisque), ConocoPhillips has 35% WI, FAR Ltd 15% WI and Petrosen, the national oil company of Senegal 10%.The three blocks cover 7,490 km2.