Conoco leaves Senegalese oil behind

MELBOURNE, Oct. 31 (UPI) -- Selling off a stake in reserves off the coast of Senegal is part of what ConocoPhillips said was a move away from deepwater exploration efforts.

Conoco's subsidiary in Senegal sold off its 35 percent stake in three exploration areas to Australian energy company Woodside Petroleum for about $440 million. Matt Fox, a vice president for the company's exploration division, said the appraisal and exploration phase went well for Conoco, but it was time to prioritize assets.

"By completing this sale we are progressing our broader exit from deepwater exploration, which will further increase our capital flexibility and reduce the cost of supply of our portfolio," he said in a statement.

Conoco said it posted a net loss for the third quarter of $1 billion, about 9 percent less than the same period last year, and said it was shifting some of its strategy away from what Conoco considered "major projects" to shale basins in the United States.

Woodside moves into oil basins in the region that are considered one of the more lucrative prospects in West Africa. According to Africa-focused Far Ltd., the SNE basin off the coast of Senegal could potentially hold more than 100 million barrels of oil. The company in 2014 started a drilling program in the nearby FAN-1 reservoir in deep waters off the coast of Senegal, which FAR at the time said could be a game changer for the region.

FAR, which also has its headquarters in Australia, is at odds with ConocoPhillips over the latter's proposed sale of its Senegalese interests to Woodside. According to FAR, Conoco has failed to comply with SNE field agreements with the proposed sale.

In a statement, FAR said it was not aware that the government of Senegal has approved the transaction with Woodside and would continue to protect its rights as a partner to the offshore fields.