Oil exploration firm Cairn Energy (CNE.L) is in talks with BP to promote a 30 p.c stake in its deepwater SNE subject offshore Senegal, which could possibly be valued at round $600 million, banking sources and a Senegal oil ministry supply mentioned.

“We are conscious that BP needs to accumulate a stake in Cairn Energy, however they’re awaiting validation by the state (of Senegal),” an adviser to Senegal’s oil minister, who declined to be named, informed Reuters by phone.

He had no additional particulars. However, Mamadou Faye, director of Senegal’s state oil agency Petrosen, mentioned no formal request had but been made by the businesses.

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“There isn’t any substance to reviews regarding Cairn’s belongings in Senegal,” a Cairn spokesperson mentioned.

BP (BP.L) declined to remark.

Cairn’s share worth rose round 5 p.c on Tuesday, BP’s was up round 1 p.c.

Oil majors have been more and more homing in on the waters off Senegal, in addition to neighbors Mauritania and Gambia, the place they believe a whole bunch of tens of millions of barrels lie.

A deal would additional increase BP’s place in Senegal following a three way partnership with Kosmos Energy in December final 12 months, which revealed a significant fuel discovery in May. BP additionally has investments in two different offshore fields there.

Senegal and Mauritania are two areas BP is focusing on over the following decade and it plans to spend billions within the Tortue LNG mission which is anticipated to supply its first fuel in 2021.

The deepwater SNE mission is the primary oil growth within the West African nation. Cairn shares the mission with Australia’s Woodside (WPL.AX) and FAR Ltd (FAR.AX). The firms anticipate to begin producing by 2021. Woodside, Australia’s largest unbiased oil and fuel producer, purchased a 35 p.c stake from ConocoPhillips final 12 months for as much as $430 million, or $2.20 a barrel primarily based on reserves of 561 million barrels on the time, earlier than these have been upgraded to almost 650 million barrels.

FAR Ltd has mentioned the mission might begin producing earlier than 2021, and at the next charge than flagged earlier than.

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Oil majors together with Total SA and China’s CNOOC Ltd have additionally been investing within the waters off this a part of the West African coast.

Source: uk.reuters.com

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