Chariot Farms Out Interests Offshore Morocco to Energean

Thursday, December 7, 2023

Chariot has signed partnership agreements with Energean on the Lixus Offshore license, where the Anchois gas development project is located, and on the Rissana Offshore license in Morocco. The deal will see Energean become operator.

Partnering Rationale:

Provides funding for both Chariot and the project through upfront consideration, deferred consideration and potentially a full carry to first gas, with Chariot retaining a material stake in the project
Secures an experienced operator for the development of Anchois – Energean is a FTSE 250 company with a proven track record in successfully developing large offshore gas projects
Accelerates growth from the portfolio, with the potential to significantly upscale the development and target further exploration prospectivity in the Lixus and Rissana licenses

Chariot went on to highlight the deal allows for leveraging of their combined expertise to co-develop Anchois, the parties are aligned on the next steps for the project development, including:

Drilling of a further well, in the east of the Anchois field and conduct a gas flow test in 2024, with rig contract negotiations advanced. Multi-objective well:
Evaluating undrilled low-risk deeper sands, to potentially materially increase the resource base for a development above 1 Tcf
Optimizing the development scheme through a production flow test
Providing a future producer well

The deal would also include the expansion of the existing offshore development plan, to accommodate potentially significantly higher production and would allow for the finalization of ongoing gas sales negotiations with a focus on meeting Moroccan energy needs, as well as progressing exploration across the Lixus and Rissana, including a 2024 seismic campaign.

Key Deal Terms:
• Energean to acquire 45% and 37.5% interests in the Lixus and Rissana licenses respectively,
and take operatorship of both licenses
• Chariot will retain a 30% and 37.5% interest in Lixus and Rissana respectively, with ONHYM
maintaining a 25% stake in each license
• Chariot will receive:
o US$10 million payable on completion of the transaction
o US$15 million payable on Final Investment Decision (“FID”)
o US$85 million gross carry including:
• All Lixus costs up to FID, including the additional Anchois well with a gas flow test
• Planned Rissana seismic acquisition costs separately capped at US$7 million
• Following completion of the Anchois well, Energean will have the right to acquire a further 10%
of Chariot’s equity in the Lixus license for:
o US$850 million gross development carry to first gas (including the US$85m gross
carry)
o US$50 million 5-year zero coupon convertible loan note with a strike price of £20
adjusted down for dividends or issuance of three million Energean shares, at Chariot’s
option on FID
o 7% royalty payment on Energean’s gas production revenues in excess of a base hurdle
on the realized gas price (post transportation costs)

For the full announcement on the partnership agreement including additional terms of the deal as well as commentary from the companies’ executive branch and Amina Benkhadra, General Director of Onhym, click here.

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Petroleum Africa

Chariot Farms Out Interests Offshore Morocco to Energean

Petroleum Africa On-The-Go

Chariot Farms Out Interests Offshore Morocco to Energean

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