Australian explorer Pancontinental has served a notice of withdrawal on BG Kenya L10B Limited the only remaining participant and operator of Kenya Licence L10B from the Joint Operating Agreement with BG and from the PSC governing L10B.
Pancontinental holds a 25% interest in L10B, while BG holds 75%. Licence area L10B lies immediately to the south of area L10A, in which a joint venture also operated by BG Group (50%) drilled the Sunbird-1 oil discovery well in 2014.
Pancontinental now remains with a license in Block L10A where it holds 18.75% and PTTEP of Thailand holds 31.25%. Pancontinental believes that it has sufficient exposure to the prospectivity of the area through its 18.75% interest in the adjoining Block L10A.
The Blocks have similar geological features that in some cases straddle the permit boundary, while exploration in L10A is more advanced.
According to CEO and Executive director Barry Rushworth the move has been guided by the interest of prudent financial management.
“The Company considers that the withdrawal is in the interest of prudent financial management, whilst maintaining a manageable and prospective exploration portfolio,” said Rushworth.
The withdrawal comes at a time that Anadarko is planning to drill its first well in the north eastern neighbouring Block L11A .
The move by Pancontinental is contrasting to an announcement last year following a 12 month extension of the license as to when the explorer said it would be increasing its stake in L10B from 15 percent to 20 percent by taking up its pro-rata share of the interest held by Premier Oil, which had also elected to withdraw.