Cairn Energy plans exploration in Morocco

Cairn Energy has confirmed planning is underway for its first the first well in its exploration programme offshore Morocco.

The multi-well exploration programme is on track to start later this year and is targeting more than 3.5bn barrels of oil equivalent (boe) of mean un-risked gross prospective resource.

Preparations include sea bed site and environmental surveys and contracting the 5th Generation semi-submersible Cajun Express rig.

Cairn said its prospect and lead inventory has grown significantly in the past year through corporate acquisitions, farm-ins, ongoing exploration work and bid round successes. The group currently has 61 prospects and 124 leads.

In the first quarter, the firm farmed-into frontier exploration positions in offshore Senegal and the Porcupine Basin, offshore West of Ireland.

The company ended the period with net cash of $1.5bn. Free cash flow from the firm's pre-development interests will be used to fund future exploration programmes.

Cairn is acquiring a 65% working interest (WI) and operatorship in three contiguous blocks offshore Senegal, by fully funding the 100% costs of one exploration well to an investment cap.

The group also announced the completion of the Skarfjell appraisal well in the North Sea. The gross resource range of the well has been revised to between 74m barrels to 235m barrels from an initial range of 60m barrels to 160m barrels.

Shares rose 1.19% to 279.60p at 10:30 Thursday.

RD