Dana Petroleum has signed an agreement with Woodside Energy (Kenya) Ltd. for a 40% interest in each of the production-sharing contracts covering blocks L5, L7, L10, and L11 offshore Kenya in return for Woodside paying 80% of the costs associated with certain work obligations.
Dana holds an 80% interest in the PSC and pays 100% of costs following an agreement between Dana and Star Petroleum International (Kenya) Ltd. announced in April 2001. This agreement has now been superseded by the new farm-in agreement, under which Dana will go forward with a 40% interest in all four PSC's, alongside operator Woodside and Star.
Woodside will earn its 40% stake by fulfilling and paying 80% of the costs of the carried work program. This program includes all work to be performed on the blocks, including seismic and drilling, through to such time as the first two exploration wells have been drilled and, if required, flow tested. Woodside has the option to withdraw from the PSCs after satisfying an initial work commitment to acquire a minimum of 5,000 km of 2D seismic. In this case, Woodside's interests would be reassigned to Dana and Star.
The seismic survey is being planned and is expected to begin in 3Q 2003.