Tullow’s Namibian well disappoints

Tullow Oil’s Cormorant-1 well is being plugged and abandoned after encountering water bearing sands, in the latest well to be drilled in the Walvis Basin offshore Namibia. Interest from industry has been intensifying as it looks to capitalise on the 2013 breakthrough Wingat and Murombe wells, and the majors have been moving in, with ExxonMobil farming into two separate deals in 2018. Attention in the region will now switch to the south of Cormorant, as the Ocean Rig Poseidon moves to PEL 71 to drill Prospect S for Chariot Oil & Gas. Both Cormorant-1 and Prospect S were highlighted by us as wells to watch in our ‘Exploration Watch: 2018 exploration wells’ report.

Although hydrocarbon sands were not found in Cormorant-1, the presence of wet gas shows in the overlying shale supports the concept that there is a working hydrocarbon system in the area. The prospect had a higher geological risk (15%COS), since it was a stratigraphic trap that relied on the presence of a stratigraphic pinch out at the feeder to the turbidite system. Prospect S is a structural trap, so is not exposed to the same key risk as Cormorant-1, and this is reflected in its higher COS of 29%. The well is targeting oil in younger and shallower sands than those in Cormorant-1: three separate Upper Cretaceous sands draped over a volcanic structure and assessed by Netherland Sewell & Associates to hold 284mmbbls. Risks still remain however and in Prospect S the main uncertainties will be the source and reservoir.

ExxonMobil is the latest major to enter the basin, farming into a 30% WI in PEL 44 in a deal with Azinam in the Maurel & Prom operated licence in August 2018, only months after farming into the Galp operated PEL 82. Both these licences sit between Cormorant-1, to the north, and Prospect S, to the south,with the Wingat and Murombe wells sitting in PEL 82.

Cormorant: Tullow (35% and operator), ONGC Videsh(30%), Pancontinental (20%), Africa Energy (10%) and Paragon (5%)

Prospect S: Chariot (65% and operator), AziNam (20%), NAMCOR (10%) and Namibian BEE (5%).

PEL 44: Maurel & Prom (42.5%) and operator), ExxonMobil (30%), Azinam (12.5%),Namcor (8%), Livingstone Mining (4%), Frontier Minerals (3%)

PEL 82: Galp(40% and operator), ExxonMobil (40%), Namcor (10%), Custos (10%)