UK independent Tullow Oil has spudded an exploration well on the Cormorant prospect off the coast of Namibia.
Joint venture partner Pancontinental Oil & Gas revealed Tuesday the drillship Ocean Rig Poseidon has started drilling the Cormorant-1 exploration well in PEL 37.
Upstream reported late last week that spudding of the well was imminent.
The well is being drilled in a water depth of 545 metres to a total depth of 3830 metres to test the oil potential of a mid-Cretaceous marine turbidite fan sandstone system.
The prospect is believed to hold a best estimate prospective recoverable resource potential of 124 million barrels of oil and the well is expected to take about 34 days to drill and evaluate.
Pancontinental noted that the start of drilling meant it would receive US$5.5 million from Africa Energy, while it is also being carried through the drilling of Cormorant-1 under the terms of its 2013 farm-out agreement with Tullow.
In late July, Andrew Latham, vice president research, global exploration at UK consultancy Wood Mackenzie, picked out the Cormorant-1 wildcat as one of the wells to watch this year.
“It is not the most enormous prospect,” Latham said of Cormorant.
“The risks are mainly play risks, not prospect risks, so if it de-risks the play, then they have got some tremendous running room.
“The fiscal terms in Namibia are great and there is tremendous appetite for development of any successes that you might make there, so it would be super commercial for Tullow if it came in.”
Cormorant is one of four submarine fan prospects identified so far in PEL 37 which are estimated to hold 915 million barrels of oil potential, while several other leads have also been identified.
The identified prospects are believed to be charged by the same source rocks as the 2013 Wingat-1 and Murombe-1 discoveries which lie directly to the south of PEL 37.
Although analysts at Westwood Global Energy Group said the Pmean success case is around 125 million barrels at Cormorant, "the upside and the potential in adjacent follow-up prospects could be significant".
Tullow readies drillbit at Cormorant"Should Cormorant work, it would significantly de-risk adjacent prospects in the same interval with a combined best estimate of around 800 million barrels (Albatross 349 million barrels, Seagull & Gannet S 338 million barrels, Seagull & Gannet N 104 million barrels).
"Some of these follow-up prospects would likely be required to succeed for a commercial development in PEL 37.
"Should Cormorant be dry with no shows, or if there is no reservoir present, it would likely write off the block and downgrade the value of adjacent licence holders acreage (such as Galp and Eco Oil & Gas)."
Tullow operates PEL 37 with a 35% interest and is partnered by ONGC Videsh on 30%, Paragon Oil & Gas on 5% and Pancontinental Namibia on 30%, with the latter company being 66.67% owned by Pancontinental and 33.33% by Africa Energy.