Plains Exploration and Production Company
) has entered into an agreement, worth $15 million, with Pura
Vida Energy ("PVD") to participate in an exploration play based
in the Mazagan permit area of the offshore Morocco. Closure of
this contract is subject to the Moroccan government approvals.
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Per the contract, Plains Exploration and Production will get a
52% working interest to operate in the 2.7 million acre Mazagan
permit area and rights to carry out some specific exploration
activities. In addition, the company is expected to drill two
more wells and carry on additional exploration activities in this
area in the future subject to an investment of up to $215
million. The first well will mainly target the Toubkal prospect
and is anticipated to be drilled in 2014. The second exploration
well will target a prospect, which will be mutually agreed upon
by both the parties.
Australia-based Pura Vida Energy is building a portfolio of high
quality assets in Africa. Currently, the company operates in the
offshore Morocco with strong resource prospects deriving full
funding from a multi-well drilling program.
The Mazagan permit area is located at the coast of Morocco in the
Essaouira Basin. Per the recent 3D seismic data, it has a number
of mid Miocene and lower Cretaceous prospects. Another source
indicates that this area can generate gross unrisked mean
prospective recoverable resource of over 7 billion barrels,
including 1.5 billion barrels from the Toubkal mid Miocene
At present, global oil and gas companies are teaming up with
local players to discover unexplored reserves in Asia and Africa.
In December 2012, oil and gas industry major
) entered into a contract with an affiliate of Impact Oil and Gas
Ltd. for the exploration of oil at the coast of South Africa. Per
the agreement, ExxonMobil will take over a 75% stake in the
Tugela South Exploration Right from Impact.
This contract is Plains Exploration and Production's first major
venture outside the U.S. The company had a cash balance of $217.0
million as of September 30, 2012, and cash from operating
activities of $415.6 million in third-quarter 2012. Plains
Exploration and Production's financial comfort lends it enough
support to sign a foreign-pact, which will subsequently enable
the company to strengthen its international presence.
Houston, Texas-based Plains Exploration and Production Company,
engages in acquisition, development, exploration and production
of oil and gas properties, primarily in the U.S. With a market
capitalization of $6.13 billion, the company having 880 full time
employees has a short-term Zacks #3 Rank (Hold).