Toreador and Hess jointly announced last week that they have signed a definitive agreement, under which Hess may become co-holder of Toreador's exploration permits in the Paris Basin, France, which represent approximately 1 million acres (of which 680,000 acres awarded and 360,000 acres pending).
The partnership combines Toreador's position covering the Paris Basin shale oil resource with Hess' position as a leading shale oil producer in the United States, along with its international operating and financial strengths.
Greg Hill, President of Worldwide Exploration and Production of Hess said, "We are very pleased to join Toreador in France. The technology we use to produce oil in U.S. unconventional plays will have a direct application to the Paris Basin. Hess views this opportunity as an area of future growth for Hess, our partner and the industry in France."
Under the terms of the agreement, Hess will make a US$ 15 million upfront payment and invest up to US$ 120 million in the project. Though Toreador believes there may be as much as 65 billion barrels of oil in the basin, only 0.5% to 1% of it can be exploited. France relies on nuclear power for it’s energy needs, but if the reserves are as large as Toreador believe then they could be able to supply as much as 5% of France’s oil requirements.
The transaction is still subject to French governmental approval though.