Cap Energy enters farm-out option agreement with FAR

TAOL Senegal (Djiffere) Ltd., in which Cap Energy PLC holds a 49 percent participation through the fully owned subsidiary Sencap, has entered into a farm-out option agreement with FAR Ltd. for the Djiffere block offshore Senegal.

The western part of the Djiffere Block is located along geological trend with the shelf play types identified in the eastern part of FAR's Research and Scientific Support Department (RSSD) blocks. The potential of this shelf trend has been proved by the world class SNE-1 discovery, which was ranked by IHS Cambridge Energy Research Associates as the largest oil discovery in the world for 2014.

FAR has identified multiple large prospects for drilling in its existing RSSD blocks along the shelf trend totaling 765 million barrels of prospective oil resources in a variety of structural play types including Buried Hill and Shelf Edge.

FAR has further identified a number of potential shelf structures within the Djiffere block from existing 2D seismic data, with one lead already estimated by FAR to have potential to contain in excess of 100 million barrels of unrisked prospective resources.

Under its agreements, FAR has the option to earn a 75 percent working interest in the Djiffere block by drilling an exploration well before July 31, 2018. The farm-in option can be exercised by FAR at any time before Oct. 31, 2016. In exchange of the farm-in option, FAR shall fund a 3D survey in Djiffere, estimated to cost $1.1 million.