Petroleum Africa
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Thursday, April 30, 2015
Solo Oil exchanged its shareholding in Pan Minerals Oil and Gas for a direct holding of 15.9% in Burj Petroleum Africa. Burj is a private UK firm created to participate in marginal field licensing in Nigeria.
Burj Africa, together with its partners, Global Oil and Gas and Truvent Consulting, has made application for two marginal fields in the current marginal field licensing round in Nigeria. These two adjacent fields contain a total of 10 wells that were drilled by an international major. These fields are believed to contain proven and possible recoverable oil reserves of 59.3 million barrels, based on internal estimates.
Solo has also entered into an agreement to increase its investment in Burj Africa. Solo will acquire an additional 5% holding in Burj Africa at closing through a payment of $200,000 in cash and, in due course, the equivalent of $300,000 in 39,750,000 new Ordinary Shares at an issue price of 0.51 p per share. Upon completion, Solo will hold a total interest of 20% in Burj Africa.
Solo has also obtained the right, at its election, to convert the equity position in Burj Africa for a participating interest directly in the JV with Global in Nigeria. The terms of which will be determined based on an independent third party valuation at a later date.
Solo will participate in the technical decision process with Burj Africa and Global, being represented on all relevant committees. Global will be the designated operator of any operations carried out by Burj Africa.
The holding cost of Solo’s shares in Pan Minerals is currently equal to the acquisition cost of those shares, approximately £800,000. Following the transaction to convert those shares to a holding in Burj Africa and the acquisition of additional Burj Africa shares the total holding value in Solo’s accounts will be approx. £1.1 million.
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