Highly prospective yet underexplored, Morocco is a frontier oil and gas destination that is now attracting serious interest from larger industry players. Both Cairn Energy and Genel Energy signed farm-in agreements this month with a consortium of smaller explorers for two deep-water blocks offshore Morocco - and wildcat exploration wells are planned for the next two years.
The consortium - comprising San Leon Energy, Serica Energy and Longreach Oil & Gas Ventures - spent two and a half years carrying out extensive seismic surveys and analysis in the area, which has led them to believe the blocks could contain up to half a billion barrels of oil equivalent each.
Genel, which is headed by former BP boss Tony Hayward and has extensive acreage in Turkey and the Kurdistan region of Iraq, has agreed to spend up to $50m (£32m) drilling a single exploration well on the Sidi Moussa block to earn a 60 per cent working interest.
Cairn, meanwhile, will spend up to $60m drilling an exploration well on the Foum Draa block in exchange for a 50 per cent working interest. The block is close to interests Cairn picked up earlier this year when it bought Nautical Petroleum, bringing its total acreage offshore Morocco to more than 10,000 sq km. The move is part of Cairn's wider plan to expand its portfolio beyond Greenland, where a recent two-year, $1bn drilling campaign failed to find any commercial quantities of oil.
Junior explorer San Leon has also contracted Enefit Outotec - a joint venture between Estonian energy group Eesti Energia and oil shale technology firm Outotec - to conduct a study on its newly awarded, shallow oil shale licences onshore Morocco. San Leon says the site has easy access and could be conducive to open pit mining. Production of liquid fuels from oil shale rock is an emerging industry worldwide, with Morocco reportedly hosting some of the largest oil shale reserves in the world.
