- The 50:50 joint venture will give both companies an equal working share in the Block 50 project.
- The collaboration has received all required approvals from Suriname; deal is expected to close within three days.
Oil & gas firms Apache Corporation and Total S.A have reportedly revealed a joint venture agreement to delve into the advancement of Block 50 offshore Suriname. As per the terms of the JV, both companies will hold 50:50 working interest in the project. Block 58 houses water depths of nearly 14 million acres, ranging from lesser than 100 m to over 2,100 m.
The block’s first three exploration wells, such as the Maka Central-1, will be operated by Apache, following which operatorship will be transferred to Total.
Apache will gain considerations in numerous forms in exchange for the 50% working interest. These include cash carry worth $5 billion on Apache’s first $7.5 billion capital for development and appraisal, nearly 25% cash carry on development and appraisal capital beyond the primary $7.5 billion, myriad cash payments in tandem with JV agreement closure and future joint development projects production as well as a 50% reimbursement for all Block 50 related costs incurred to date.
Total and Apache have also reached an agreement to bear their fair share of working interest costs on all exploration wells in the future.
Apache CEO & President, John J. Christmann has apparently stated that the addition of Total’s robust experience in offshore operations and global exposure to Apache’s existing alliance with Staatsolie make it an ideal collaborator for a project of this scale.
He also said that once the agreement has met specific drilling commitments, the companies would have the rights to explore the whole block sans acreage losses through mid-2026. Mr. Christmann further added that preliminary data and results from two upper Cretaceous play types explored so far have been encouraging for both Apache and Total. Testing and deepening activities will persist at the Maka Central-1, with the rig expected to move to the next location following the completion of these operations.
Source Credit: http://investor.apachecorp.com/news-releases/news-release-details/apache-corporation-and-total-sa-announce-50-50-joint-venture