Scottish oil explorer Cairn Energy said today it had signed up a partner for its offshore Greenland exploration.
Norwegian oil major Statoil has taken a 30.265% stake in one of Cairn’s licences offshore Greenland – the Pitu block in Baffin Bay.
Edinburgh-based Cairn, which has been leading an exploration charge into the Arctic region but has yet to make a commercial discovery, said it saw “significant potential” in the block.
Simon Thomson, the firm’s chief executive, added: “Statoil’s extensive Arctic operating and development experience makes them the partner of choice for the Pitu block, where we see significant potential.
“With a strong balance sheet and the first Greenland farm-out completed, Cairn is well positioned to access new opportunities and further growth in 2012.”
The announcement follows the completion of a deal to sell off 40% of Cairn’s India business, leaving it with 22% it said was worth about £1.6billion.
Some £2.25billion is proposed to be returned to shareholders in February, which left Cairn with £3billion cash on December 31, 2011.
The cost of the farm-out of the Pitu block was undisclosed but is thought to include semi-state owned Statoil paying a signature bonus, back costs and promoted terms of future exploration expenditure.
Cairn said a sampling programme in the area in 2011 had found “micro seepages” of oil on the seabed.
Results of seismic on the area are due in the second quarter of this year, the firm added.
Under the deal, which has to be agreed by Greenland’s government, Cairn will continue as operator on the licence until any development phase
It will hold 56.8% interest alongside Statoil and Nunaoil, which holds a carried interest of 12.5%.
Cairn has led a resurgence of interest in the Arctic after starting drilling in the region in 2010.
It says its exploration acreage off Greenland could hold billions of barrels of oil.
However, environmental groups say the firm’s activities threaten the Arctic environment.
In a trading update, Cairn also said it had been offered two exploration licences offshore Spain – held by its Spanish subsidiary, Capricorn Spain – and that it was actively pursuing other acreage in Spain.