Petro-Canada announced that it had signed six new exploration and production sharing agreements (EPSAs) with the Libyan National Oil Corporation.
The new EPSA agreements are expected to have a duration of 30 years and will focus on the redevelopment of existing producing fields by Harouge Oil Operations,a joint venture operation between Petro-Canada and Libyan National Oil Corp.
Under the new agreement, Petro-Canada will pay 50% of all development costs and will receive an initial 12% entitlement share of production.
Petro-Canada added that it estimated that there are gross contingent and prospective resources of almost two billion barrels of oil associated with the redevelopment program. The redevelopment program will require a total investment of around UD$7 billion over the next five to seven years. Once complete, production levels are expected to double to 200,000 bopd.
Petro-Canada additionally said it would invest US$460 million in the Sirte region.
"We believe that we have significantly increased the value of our business in Libya," said Peter Kallos, Petro-Canada's Executive Vice-President, International and Offshore. "We've unlocked a long-life asset with potential for material earnings and cash flow, as well as very prospective exploration acreage."