The company on Friday said well operator and principal farminee Nexen Petroleum UK has signed up the Borgsten Dolphin drilling rig on a multi-well contract.

Under the farm-in agreement, Elixir will retain a 13.125% interest in Block 15/13b, with its share of the well cost being fully funded by Nexen and Gas Plus Italiana SpA.

Gas Plus gained a 6.25% interest in the block during the quarter after Canadian oil and gas company Albion Petroleum withdrew from the project when it failed to prove its financial capacity earlier this month. Gas Plus now has a total stake of 12.5%.

Located about 20km northeast of the Piper oil field, the prospect lies in about 150m of water and is a robust, four-way dip-closed Palaeocene structure that lies on trend with fields such as Balmoral and Dumbarton.

On an unrisked basis, the Guinea structure is estimated to host potential resources of between 65 million (low case) and 120 million (high case) barrels of oil on Block 15/13b if hydrocarbons are present, with a mid case estimate of 91MMBbl.

Elixir said the well is expected to take about 21 days to drill on a dry-hole basis.

Block 15/13b was awarded as a promote licence to joint venture partner Granby Oil & Gas in the 22nd licensing round in December 2004. Under an alliance agreement, Elixir was entitled to earn a 35% interest.

Elixir also said “advanced” farm-out negotiations for Block 14/14b, which hosts the Anglesey prospect in the North Sea, are continuing.

“We are confident that a farm-in deal will be finalised whereby Elixir and its partner, Granby Oil & Gas, are free-carried through another exploration well,” it said.