How Do you Say Exploration in French?
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Total (NYSE: TOT) has an extensive collection of exploration prospects and plans to use these properties to generate long-term oil and gas production growth for the company. These prospects are spread across its global portfolio, including Africa, South America, Iraq and Europe.
Total expects to grow oil and gas production by a 3% compound annual growth rate through 2015 and said that the projects needed to generate this growth are already producing or under development. The company has set an informal 2017 production growth target of 3 million barrels of oil equivalent (BOE) per day and estimates that 70% of this growth will be from projects that have already been sanctioned.
Total has a large number of exploration prospects and has brought many of these into the development phase over the last few years. The company allocated $2.5 billion in exploration capital spending in 2012 to advance further on some of these prospects.
Total has been active in Angola since 1953 and reported net production of 135,000 BOE per day in 2011 from its operations here. The company has interests in many offshore blocks and sees exploration potential in blocks 25, 39 and 40. These blocks are located in the Kwanza Basin and Total was awarded an interest in the most recent licensing round held by the Angolan government.
Total is the operator of blocks 40 and 25 and owns a 50% and 35% interest, respectively. The company owns a 15% interest in block 39 and will participate in exploration here on a non-operated basis.
Total believes that the Kwanza Basin may be analogous to the Santos Basin in Brazil and is currently conducting a 3D seismic program on these blocks. The company is targeting sub salt formations and expects to drill a minimum of four exploration wells here in 2013 and 2014.
Statoil (NYSE: STO) is involved in Angola and is a 55% owner and operator of block 39. The company also owns a 20% non-operated interest in blocks 25 and 40. BP (NYSE: BP) also owns a 15% non-operated interest in block 25.
The targeted blocks are close to a successful exploration well drilled by Cobalt International Energy (NYSE: CIE) on the Cameia prospect on offshore block 21. The company followed up this well with an appraisal well that confirmed the presence of oil and gas. Cobalt International plans further testing at the Cameia prospect in 2013.
Total also has exploration prospects in the Ivory Coast and is working on four offshore blocks. The company plans to spud its first well in December 2012 on block CI 100 and is conducting seismic surveys on its properties. Total will drill three exploration wells on the other blocks in phase one of the program.
Total was given an exploration license on offshore block 14 by Uruguay in May 2012. The acreage is located in the Pelotas Basin and the company plans its first well in 2014 after its seismic program is completed.
Another operator active in Uruguay is Petrobras (NYSE: PBR), which has interests in offshore blocks 3 and 4. The company is analyzing seismic and other data from these blocks and will decide on a drilling program by 2014.
Total has other exploration prospects in its portfolio and will have active programs through 2015 on its properties in Bulgaria, Argentina, Iraq, Brazil and French Guiana. The company plans a total of 39 exploration wells from 2012 to 2014.
Total is not content with its current development program and plans substantial investment over the next decade on a number of exploration prospects across its global portfolio. The company will depend on the success of this program to grow oil and gas production in the long term.
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