Petroleum Africa
Find us on: 
Thursday, January 9, 2014
Simba Energy signed an exclusive LoI with an unnamed private Canadian group to farm-out up to 40% stake in Simba’s PSC for Block 2A onshore Kenya. The deal is for a total commitment of $8.6 million.
Under the terms of the farm-out, $2.0 million for cost recovery will be placed in trust immediately upon signing of the definitive agreement. These funds will be released to Simba once the farm-out agreement is approved by the Kenyan government. This payment for cost recovery will entitle the unnamed firm to a 10% interest in the PSC. Simba will be carried through the funding and completion of $6.6 million in exploration work to include a minimum of 421 line kilometers of 2D seismic that is to be carried out in 2014.
In total, the group will earn a 40% interest in Simba’s Kenya PSC upon payment of the $2.0 million and completion of the $6.6 million work program. Upon completion and interpretation of seismic results, both parties mutually agree to either drill a first exploration well with each party responsible for its own share of costs, or to farm-out to other third parties on mutually acceptable terms.
Robert Dinning, CEO of Simba, stated, “This LOI provides a fully funded and accelerated exploration program through to selecting drill targets and allows Simba to recover US$2.0 million in costs upon completion of the definitive agreement and host Government approval. The company and its shareholders retain significant interest in Block 2A. This block is highly prospective given the exploration work completed to date by the company and exploration activities underway by neighbouring energy companies, including: Tullow, Africa Oil, Marathon, Afren and Taipan on the adjacent blocks to 2A in the Anza basin. The Anza basin is one of the largest Tertiary-age rift basins in East Africa. We expect the definitive agreement to be signed in Q1 2014 – and for the 2014 work program to begin thereafter.”
" alt="First LNG Realized at the Greater Tortue Ahmeyim Project">
" alt="United Energy Acquires Western Desert Producer APEX">
" alt="Baker Hughes Announces Major Gas Technology Orders for Venture Global LNG">
" alt="ReconAfrica: Naingopo Results Demonstrate a Working Petroleum System">
" alt="Tullow Highlights 2025 Operational Plans in Ghana">
" alt="TotalEnergies to Supply 1.5 TWh to STMicroelectronics in France Over 15 years">
" alt="Rockhopper Reaches Final Settlement with United on Egypt’s Abu Sennan Concession">
" alt="Oil & Gas Crucial for African Growth: AEC Calls for Industry Support to Defend African Market">
