Continental Focus, International Reach

Calima to Sell Namibian Stake

Sunday, May 26, 2019

Calima Energy reached a deal with Tullow Oil to sell its interest in Namibia’s PEL 90 (Block 2813B). The parties have agreed to a 60-day exclusivity period to enable the satisfaction of certain industry standard conditions precedent, which include; entering into a formal sale and purchase agreement, customary due diligence, Tullow board approval and government and partner approvals relating to the assignment of interest and transfer of operatorship.

Calima will receive $2.0 million on completion. Success bonuses totaling $10.0 million will be paid in two equal tranches ($5.0 million) following the grant of a production license and then upon the commencement of commercial production.

Alan Stein, Calima’s Managing Director commented: “With recent drilling success in the Montney this transaction allows us to focus capital allocation towards Canada while maintaining financial leverage to exploration success in Namibia. The Namibian block is a world-class exploration play with extraordinary upside but it will require considerable investment and time to reach the point of exploration drilling. The Montney offers our shareholders a significant value proposition in the short term where the Company can now put in place the building blocks of a world-class development with modest capital investment. We wish Tullow and our Namibian partners every success in Block 2813B.”

Prior to the sale, Calima held a 56% stake in PEL 90 and was partnered with Trago Energy, Harmattan Energy, and Namcor.