LONDON (ShareCast) - Oil and gas exploration and development firm Cairn Energy is expanding its operations in West Africa by farming in to Chariot Oil & Gas' C19 block offshore Mauritania, an attractive new country entry according to the company.

The block, currently 90%-owned by Chariot and 10%-owned by Mauritanian state company, SociétéMauritanienne des Hydrocarbures (SMH), lies close to existing discoveries and contains the tertiary and cretaceous deep water fan plays proven further south along the West African margin, Cairn said.

"The two wells previously drilled in the shallow water areas of the block, both contained reservoirs with oil shows and point to the oil migration potential from the south."

Under the agreement, Cairn is to pay Chariot $26m for costs of the seismic survey which is currently being processed, as well as other costs. Afterwards, exploration costs will be shared out between Cairn (which will take a 35% working interest), Chariot (55%) and SMH (10%).

"The opportunity in Mauritania presents an attractive new country entry, building on our existing Atlantic Margin portfolio in Senegal and Morocco," said Cairn's Chief Executive Simon Thomson.

"By developing an increased strategic presence in the under-explored and highly prospective new plays in this region, we can generate both operational and geological synergies and fully apply our proven frontier exploration skills."

Cairn has the option to take operatorship of the block if it ups its stake to over 50% before the end of the first phase of the licence in June 2015.

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