PERTH (miningweekly.com) – ASX-listed energy developer FAR has struck a binding memorandum of understanding (MoU) with Glencore Energy for its share of the crude oil produced at the Sangomar field, in Senegal.
The joint venture (JV) partners of the Sangomar field development project have recently green-lit the Phase 1 development, which will target an estimated 231-million barrels of oil equivalent from the lower, less complex reservoirs, and an initial pilot phase in the upper reservoirs.
First oil is targeted for 2023.
FAR has secured a $300-million lending facility, which in addition to a A$146-million capital raise, would be used to fund its share of the Phase 1 development capital.
FAR said on Wednesday that the binding MoU with Glencore would be subject to the negotiation of final documentation, and provided FAR with access to the extensive marketing and offtake resources of one of the world’s leading marketers of crude oil.
Provided that Glencore remains as a lender to FAR, the offtake is expected to run over a period of seven years, following first oil, with FAR’s share amounting to a minimum of 20-million barrels over this time.
FAR on Wednesday told shareholders that work continued on plans for the development of the Sangomar field, and that a concept select decision was likely to be made by the JV partners in the third quarter of this year.
Orders have already been placed for long-lead items for the drilling and related completion, with drilling planned to start by the end of the first quarter next year.