Oil Search’s Alaska programme progressing, says Botten
OIL Search Ltd has made progress in the Pikka unit drilling programme in Alaska by aligning itself with Repsol, the minor shareholder company in the oil project, says managing director Peter Botten.
Botten said this would provide the basis to enable sensible commercial decisions when exploring and developing the project.
“We carried out a substantial realignment with Repsol to provide the basis of sensible commercial decisions on the way forward for development and exploration across the north-slope portfolio,” he said.
“We also sourced very strong results out of the Pikka unit during winter in Alaska last year. “There were also progress made with the record of decision (and land use agreement which encouraged progress on the development of the Pikka unit in a phased and sensible way.”
Chief financial officer Stephen Gardiner said: “The realignment agreement will be settled in the next few weeks which will result in a net cash outlay of US$380 million (K1.26 billion).
“The sell down of some of the Alaskan equity required under the Armstrong option is now planned to occur closer to development of the project.
“Accordingly, an additional US$300 million (K1bil) short-term bank credit loan has been arranged and we’re still waiting for Bank of Papua New Guinea to give the approval, which we expect shortly.
“That’s to provide additional financial flexibility until we complete that sell-down process.” Executive vice-president and president of Oil Search Alaska Keiran Wulff said: “We had significant progress in Alaska since we acquired the asset and taken over operatorship.
“Most importantly we also wanted to develop an alignment with Repsol who are very committed to this area and we wanted to make sure that we both have a common vision going forward.