Oct. 9 (UPI) -- French energy company Total said Monday it was expecting a big oil pay off from the under-explored deep waters off the coast of the Republic of Guinea.
The company signed an evaluation agreement with the National Office of Petroleum of Guinea for deep and "ultra-deep" areas off the Guinean coast.
"By taking this position on a new under-explored area, Total pursues its exploration strategy targeting deep offshore prospective basins," Kevin McLachlan, a senior vice president for exploration and production at Total, said in a statement. "Therefore, Total has the opportunity to evaluate a very large area, located in an extension of the prolific Mauritania-Senegal basin where we already are."
Companies like Australia's FAR Ltd. have led the early focus on the oil potential off the West African coast. When discovered in 2014, the reservoirs offshore Senegal in particular were counted among the largest in the world. By the estimates of the companies involved, more than 1.5 billion barrels of oil may be in basins off the nation's coast and FAR Ltd. said the broader region is "clearly one of the world's exploration hot spots."
Total said that it has a year to assess the potential off the coast of Guinea. After that, it will decide on three license areas in which to conduct an exploration campaign.
The French company is coming off a strong quarter, with adjusted net income growing by 13 percent from last year to $2.5 billion. Chairman and CEO Patrick Pouyanné said when releasing results for the second quarter that his company could "take advantage of the low-cost environment" by taking on new resources.
The company in August bought off the oil unit of Danish shipping giant A.P. Moller-Maersk for $7.45 billion, taking on $2.5 billion of the debt held by Maersk Oil in the process.