Feb. 12 (Bloomberg) -- Tullow Oil Plc, a U.K. explorer that produces most of its crude in West Africa, said the Fregate well opened “a new oil play” off Mauritania.
The Fregate-1 well discovered about 30 meters (98 feet) of net gas condensate and oil accumulation after drilling to a depth of 5,426 meters, Tullow said today in a statement. It’s Mauritania’s deepest well and will need further tests, Exploration Director Angus McCoss said.
Models showed “we’d get richer and richer if we went deeper and deeper and that proved to be the case,” McCoss said by phone. “We are not looking at a commercial stand-alone” discovery, “we’ve got a great result and are opening up an oil play.” He declined to provide the well-resource estimate.
Tullow, which today said 2013 earnings slid 73 percent to $169 million after disposals, plans to invest about $1 billion this year to explore for oil in Mauritania, Kenya, Ethiopia and Norway and drill its first well off Guinea. It was targeting the equivalent of about 300 million barrels of oil in Mauritania’s Block C-7, where Fregate was drilled, McCoss said last year.
The company fell 6.3 percent to 792.5 pence in London.
GDF Suez SA, Petroliam Nasional Bhd. and Korea National Oil Corp. are partners in the well. The companies invested more than $200 million to drill it, McCoss said.
Tullow is looking for partners to drill wells off Mauritania and Guinea to shares costs, McCoss said.
Tullow, Total SA and Cnooc Ltd. signed a memorandum of understanding this month with the Ugandan government to produce about 200,000 barrels of oil a day in the country.
In Ghana, it plans to invest about $1.2 billion this year to develop the Tweneboa-Enyenra-Ntomme (TEN) project.
The company is talking to Ghana about possible gas flaring at the Jubilee field, its largest project, to allow the field to pump about 100,000 barrels of oil a day in 2014, it said today.
Tullow relinquished its interest in Block L8 in Kenya and wrote off the Ngassa discovery, extending beneath Lake Albert as offshore appraisal and development is now uneconomic, it said.
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