Cairn Energy said yesterday it had secured a drillship for work offshore western Greenland next summer, a year earlier than planned.
Greenland has been attracting strong interest from oil companies in recent years, despite having no tradition in oil production and harsh conditions for exploration.
There are hopes that its waters could hold billions of barrels of oil, but a single find of about 400million barrels could be a commercial proposition at a price of just $40 a barrel.
Cairn exploration subsidiary Capricorn, which owns large oil blocks offshore Greenland, has already carried out a pre-exploration programme.
Edinburgh-based Cairn said yesterday that dynamically positioned drillship Stena Forth was to start operations in the summer drilling season, which runs from June until October, on the Disko West acreage.
The rig is under contract to Hess. Cairn has reached an agreement to use the Stena Forth for about six months.
Cairn is understood to be planning a two-well drilling programme off Greenland next year.
The value of the contract involving the Stena Forth has not been disclosed, but there is speculation it will be worth £500,000 a day.
Cairn chief executive Sir Bill Gammell said: “We are delighted to have secured a rig that allows Cairn to move forward with its Greenland drilling programme in 2010, a year earlier than previously scheduled. We are now equipped to commence drilling with a vessel that offers considerable operational flexibility.”
In October, Cairn said it had agreed a farm-out deal with PICL, the overseas arm of Malaysian state oil company Petronas, on its acreage offshore Greenland.
The Scottish company said it had agreed to sell to PICL a 10% interest in its six operated blocks and that the Malaysian group would also have an option to increase its interest to 20% in any development in these blocks, in return for further payment.
Cairn also said it was selling a 2.3% stake in subsidiary Cairn India to PICL. The Cairn India share transaction takes PICL’s holding in the company to 14.94%, with Cairn retaining 62.75%.
Cairn said PICL would pay about £196million in total: about £152million for the Cairn India stake and £44million to farm into the Greenland blocks.
It added that the funds would be used for additional investment in Greenland exploration.
In August, Cairn had said it planned to drill several wells off Greenland in a drilling campaign starting in 2011.