West African oil and gas explorer FAR Ltd. said Monday its footprint in the region expanded after the Gambian government approved a major buy-in.

Under the terms of an agreement, FAR takes on 80 percent of the interest in two blocks off the coast of Gambia from its partner, ERIN Energy Corp. The deal requires FAR to commit to as much as $8 million in financing for the drilling of an exploration well by the end of next year.

With a hold on the reserves just north of Gambian waters in Senegal, FAR said it was setting itself up as a major player in the broader Mauritania-Senegal-Guinea-Bissau basin in West Africa.

"We look forward to working with the government and our joint venture partner ERIN Energy to carefully and thoroughly explore these highly prospective offshore blocks," Managing Director Cath Norman said in a statement.

Combined, the two blocks offshore Gambia are estimated to hold at least 1 billion barrels of oil. With an estimated 1.5 billion barrels offshore Senegal, FAR, which has headquarters in Australia, said the larger region is "clearly one of the world's exploration hot spots."

On top of a debt-free first quarter, FAR was over-subscribed for a placement of 1 billion shares, generating around $60 billion in capital it will use to fund drilling, evaluation and pre-development programs.

FAR and Woodside Petroleum are two Australian energy companies included in a consortium with Cairn Energy exploiting the reserves off the coast of Senegal. Parties to the effort are at odds over the transfer of assets from Conoco Phillips to Woodside, which aims to transition to the role of the operator.

FAR Ltd issued a plea to an international court in Paris to intervene in the spat. Woodside said the government of Senegal has confirmed its role in the joint venture.

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