Savannah Petroleum signed a preliminary agreement with Niger for an early production scheme related to recent discoveries in Agadem Rift Basin production sharing contract in the south east of the country.
The British independent oil and gas company, through its Niger subsidiary, Savannah Niger, will work together with the government on the early production scheme and set out timelines for the project, Savannah said in a statement.
The scheme is intended to be domestic focused, with oil produced from Savannah Niger’s R3 area discoveries expected to be sold at the Société de Raffinage de Zinder refinery (SORAZ) , which is connected to the ARB via the third party owned 463km Agadem-Zinder crude oil transportation pipeline.
“We are very pleased with the success Savannah has achieved in its exploration drilling campaign to date, with three discoveries from its first three wells. As a Government, we are keen to see that these and future discoveries commence production as soon as possible, given the positive contribution to economic growth, tax revenues and our local communities that they have the potential to deliver,” said Foumakoye Gado, Niger Minister of Energy and Petroleum.
Andrew Knott, CEO of Savannah Petroleum, said the company’s Niger project team is focused around the delivery of near-term production and cash-flows from existing and future discoveries in the R3 area as well as further material reserve adds through ongoing exploration and appraisal drilling program.
“Savannah benefits from the large bank of drill-ready exploration prospects that our technical team has mapped within our PSC areas. We believe the vast majority of these prospects have similar risk profiles to the ones we have already successfully drilled, and we therefore look forward with confidence to the results of the wells still to come in the campaign,” he said.
As part of the new agreement, the government of Niger will facilitate and conclude crude oil marketing deal between Savannah Niger and SORAZ as well as the infrastructure access agreement between Savanah Niger and the owner of third party crude oil processing and transportation infrastructure.
Savannah will submit a pre-feasibility study to Niger related to the discovered crude oil resources in the R3 area anticipated to be included in the early production scheme, the company said.