Apache has opted out from the production sharing agreement (PSC) with Pancontinental Oil and Gas of Kenya’s offshore Block L8 saying it will not participate in any further discussions in the new PSC after the former agreement expired.
Apache had owned 50 percent in the agreement, Origin owned 20% while Pancontinental and Tullow own 15%.
Pancontinental Oil and Gas says it continues to attend meetings with the Kenyan Ministry of Energy and Petroleum to discuss the Kenyan offshore Block L8 Production Sharing Contract and its forward exploration programme.
“Pancontinental has had initial scoping talks with the Ministry and has requested to enter into negotiations with the Ministry and a potential co-venturer for the grant of a new PSC in respect of Block L8,” the company said in a statement signed by CEO and Director Barry Rushworth.
Pancontinental is the longest-standing explorer and licence holder in Kenya and has a lengthy and cordial relationship with the Ministry.
Pancontinental says it has been part of a consortium that has spent more than $135 million on exploration within
Block L8 and has considerable exploration data in respect of Block L8.
“While there is no guarantee that a new PSC can be agreed with the Ministry, Pancontinental aims to negotiate and finalise a new PSC that will replace the old PSC and better reflect matters such as production sharing and a revised forward work programme.”