Sao Tome and Principe has a chance to become a new oil producer in case of positive results of the recently spudded Jaca-1 new-field wildcat, targeting a Cretaceous-aged basin floor fan. The prospect is located within the offshore Block 06 operated by Portugal’s Galp Energia with Royal Dutch Shell as a technical operator. Jaca-1 is the first-ever offshore well to be drilled in Sao Tome and Principe exclusive economic zone (EEZ) and also the first exploration well in distal Gabon-Douala Deep Sea Basin. If successful, the well will prove a working petroleum system in the deep offshore area outboard of the Douala, Rio Muni, and Gabon Coastal basins.
The well is currently being drilled by the Maersk Voyager drillship at a water depth of around 2,500 m, targeting a probe at a total depth of about 4,500 m. If successful, the possible development of the field would involve a floating production, storage and offloading (FPSO) vessel with offshore loading onto shuttle tankers to export the crude oil to market. With prevailing and forecasted oil price expected to remain over $90/bbl until the end of 2023, at $95/bbl the minimum economic field size (MEFS) is estimated to be in the region of 180 MMbbls recoverable, while a discovery of 300 MMbbls is expected to have a NPV of over USD 1 billion. At a more conservative Brent oil price scenario of $85/bbl Galp Energia is likely targeting at least 270 MMbbls recoverable, while a discovery of 500 MMbbl will have a value over USD 1 billion with IRR of 13% and a government take less than 40%.
Should Jaca-1 be a success, it has the potential to de-risk prospective resources in the Gabon-Douala Deep Sea Basin and play a key role for the future exploration activities within Sao Tome and Principe.
