Shoreline Canadian Overseas Petroleum Development Corp. (ShoreCan) has negotiated finance of between $30 million and $50 million for investment in its 80% owned affiliate Essar Exploration and Production (Nigeria).
The Mauritius Commercial Bank and Trafigura PTE are the parties involved in the funding arrangement. ShoreCan is 50% owned by Canadian Overseas Petroleum Ltd.
The facility will help pay for all production-related expenditures following drilling and testing of the initial production well to be drilled by Essar Nigeria on the OPL226 lease, in shallow to mid-water offshore Nigeria.
However, drawing on the facility is contingent on amongst others:
ShoreCan itself providing an additional $20-33 million of funding attracting a further $100 million funding from an offshore oil services group to deliver the project a minimum average production rate of 6,000 b/d over 20 days
Securing a formal definitive binding agreement between the parties.
The project as planned will entail drilling and completion of a horizontal oil production well offsetting the 2001 NOA#1 oil discovery well and of two or three further high angle oil production wells in the adjacent NOA East fault block from a common wellhead platform; and placing these wells online during an approved early production scheme.
Essar has prepared a work program for this initial campaign in the form of a field development plan for submission to the concessionaire, NNPC.
ShoreCan is in late stage discussions with the identified service provider, covering the provision of drilling services, the supply of a mobile production unit and a storage vessel for a deferred fee.