Petroleum Africa
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Monday, March 23, 2015
African Petroleum issued an update regarding an extension of a non-binding term sheet with a private E&P firm out of the UK to farm-into its 100% operated LB-08 license offshore Liberia. The company said that it has agreed to a request from a third party for an additional extension of the proposed completion date. African Petroleum said that an extension of approximately three months, until June 20, has been agreed on to allow for conditions affecting the third party outside their control to be resolved.
As previously disclosed by the company, pursuant to the Term Sheet the third party has agreed, subject to inter alia to completion of due diligence and the entering into of mutually agreed contracts, to acquire a 50% net participating interest in the LB-08 license in return for the payment of 50% of all future costs and expenditures relating to the LB-08 license and a contribution to past costs and expenditures.
The license is situated in a highly prospective region offshore the country and an independent review of the company’s acreage by ERC Equipoise in April 2014 and an update in January gave the acreage an estimated net un-risked mean prospective oil resources exceeding 2.6 billion barrels. With the discovery of a working hydrocarbon system in the adjacent license, African Petroleum believes the license has substantial potential.
Completion of the farm-in as laid out in the Term Sheet is subject to a number of conditions, which apart from government approval, is scheduled to be completed by June 30.
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