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While some IOC's are pulling back from exploration, Petronas is
pushing forward with a second high impact well within the Gabonese
deep waters following the Boudji discovery in 2018. The Jove Marine
well was spudded in early November 2021 and it will test a four-way
dip closure in the pre-salt Gamba and Dentale formations in the
distal portion of the Lower Congo Basin. With a minimum economic
field size estimated at 150 MMbbls of oil at USD$ 70/bbl and the
improved chances of an oil-mature source rock following the Ivela
discovery, the well, if successful, will further confirm the
potential of the pre-salt in the deepwater areas of the basin. The
eight additional prospects within the block have a combined
estimated 8.7 Bboe in place and may provide significant upside
within the block.
The actual contract terms are not publicly available and as such
the fiscal model is based on the 2019 petroleum code and 2008 model
contract together with rates indicative of publicly available
signed contracts. The regime includes cost recovery and profit
sharing with the contractor profit share calculated via a
progressive sliding scale linked to average daily production. This
progressive mechanism is aimed at capturing a greater share of the
resource wealth for the state as windfall conditions occur. The
impact can be seen from the NPV sensitivity chart showing a
deflection of the NPV curve as resource size together with
production rate increases.
Posted 01 December 2021 by Chris Ellis, Principle Petroleum Economist, IHS Markit and
Erik Meyer, Senior Technical Research Analyst, S&P Global Commodity Insights and
Nicholas Waters, Senior Technical Research Analyst, Upstream Energy, S&P Global Commodity Insights
