Canadian oil and gas company Africa Energy has acquired a 10 percent interest in a license offshore Namibia.
According to its statement on Wednesday, this is being done through an acquisition of one-third of the shares in a subsidiary of Pancontinental Oil & Gas N.L. that holds a 30% participating interest in Petroleum Exploration Licence 37 (PEL 37) offshore Namibia.
Garrett Soden , Africa Energy’s President and CEO, commented, “We are pleased to partner with Pancontinental for an effective 10% interest in PEL 37 offshore Namibia. This transaction completes the discussions we began some time ago and demonstrates our commitment to this oil prone play. We look forward to the exploration well that may be drilled as early as next year.”
Africa Energy paid Pancontinental $2.2 million at closing and will pay an additional $5.5 million upon spud of the first exploration well provided that certain commercial conditions exist on the spud date.
This is the second time for Africa Energy to try and farm into the PEL 37 license offshore Namibia through a transaction with Pancontinental. However, Africa Energy last March exercised its right to terminate the deal as a result of due diligence procedures performed by the company. Namely, the company identified discrepancies in respect of certain agreed commercial terms of the transaction.
The PEL 37 covers 17,295 sq km (4.2 million acres) in water depths extending to 1,800m in the Walvis Basin offshore northern Namibia. The license is operated by Tullow Oil with 65% interest. Pancontinental holds 30% interest and the remaining 5% is held by Paragon Oil & Gas.
The entire current phase of the PEL 37 exploration program consists of 3,000 sq km of 3D seismic acquisition, processing and interpretation; 1,000 linear km of 2D seismic that will highlight additional leads; and, depending on the outcome of the seismic programs, one exploration well.
Offshore Energy Today Staff