HOUSTON, Dec. 22, 2019 (GLOBE NEWSWIRE) -- Apache Corporation (NYSE, Nasdaq: APA) and Total S.A. (NYSE: TOT) today announced a joint venture agreement to explore and develop Block 58 offshore Suriname.
Under the terms of the agreement, Apache and Total will each hold a 50 percent working interest in Block 58, which comprises approximately 1.4 million acres in water depths ranging from less than 100 meters to more than 2,100 meters. Apache will operate the first three exploration wells in the block, including the Maka Central-1 well, and subsequently transfer operatorship to Total.
In exchange for a 50-percent working interest, Apache will receive various forms of consideration, including: $5 billion of cash carry on Apache’s first $7.5 billion of appraisal and development capital; 25% cash carry on all of Apache’s appraisal and development capital beyond the first $7.5 billion; various cash payments in conjunction with closing of the joint venture agreement and future production from joint development projects; and reimbursement of 50% of all costs incurred to date in Block 58. Apache and Total have also agreed to bear their proportionate working interest share of costs on all future exploration wells. The transaction has received all necessary approvals from Suriname and is expected to close within three days. Further details of the terms are outlined on Apache’s website.
“Suriname Block 58 presents a unique, large-scale oil resource opportunity, and we are very pleased to welcome Total to our existing partnership with Staatsolie, the national oil company of Suriname. Total’s extensive offshore operational experience and global footprint make it an ideal partner for a block of this size and potential,” said John J. Christmann, CEO and President of Apache. “Upon meeting certain drilling commitments, the partnership has the rights to explore the entire block through mid-2026 without acreage relinquishments. This provides for a thorough evaluation of the multiple play types we have identified in this emerging oil-prone basin.”
“We are very pleased to team up with Apache and Staatsolie, and to become operator of this promising license where we will bring our deepwater expertise. It is indeed a unique exploration opportunity in a prolific basin,” said Patrick Pouyann, Chairman and CEO of Total.