Lukoil has reached an agreement with Cairn Energy to buy Cairn Energy's entire 40% stake in RSSD (Rufisque, Sangomar and Sangomar Deep) project in Senegal for US$300m in cash. In addition, the deal also includes a potential bonus payment to Cairn Energy of US$100m once production starts. The transaction is subject to customary conditions, including government approval, and is expected to close by the end of 2020.
The blocks include two discovered fields, Sangomar and FAN. The Sangomar field is developed by a joint venture of Woodside Energy (35% and operator), Cairn Energy (40% stake sold to Lukoil), FAR (15%) and Petrosen (10%). In January 2020, the government of Senegal approved the Sangomar Development and Exploitation Plan along with the exploitation authorisation, submitted by the Australian oil and gas company Woodside, the operator of the Sangomar (formerly SNE) Field Development 1. Consequently, Woodside has executed the purchase contract for the floating production storage and offloading (FPSO) and has issued full notices to proceed for the drilling and subsea construction and installation contracts. The final investment decision (FID) on the Sangomar field was thus made in early 2020. Requiring an investment of US$1.2bn, the Sangomar Field Development Phase 1 will target an estimated 230 Mboe and will consist of a FPSO vessel, with a capacity of around 100,000 bbl/d. First planned in 2021, its commissioning was delayed from 2022 to early 2023 in November 2019.