Petroleum Africa
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Friday, May 10, 2013
Solo Oil reported that it has signed a binding MoU to acquire a 15% shareholding in Swiss firm Pan Minerals & Oil. Under the MoU Solo will pay a cash consideration of £200,000 plus 60 million new ordinary Solo shares of 0.01p, each representing a total aggregate consideration of £500,000.
Solo said that the purpose of this investment in Pan Minerals is to assist it in consummating certain existing production agreements that it has negotiated for acreage onshore in West Africa. Pan Minerals is a special purpose vehicle company that focuses on proven reserve situations which have the potential to be brought on production at over 2,000 bpd within a 12-month period.
In addition, Solo has been granted a 90-day option for a first right of refusal (FROR) to participate in any future equity financing of Pan Minerals for the development of its West African oil production opportunities. The FROR will allow Solo, at its sole discretion, to increase its direct equity interest in Pan Minerals from 15% to up to 49.9% subject always to any constraints Solo may have due to its investing policy as previously approved by shareholders.
Pan Minerals has invested nearly US$3mm to date in the pursuit of farm-ins on proven oil fields in West Africa and Solo’s investment will assist in the completion of these arrangements. It is envisaged that the MoU will be converted to a full Sale and Purchase Agreement within a week and the Company will advise when the shares will be issued and admitted to AIM.
Neil Ritson, Solo’s CEO, commented: “The Solo Board is familiar with the proven on shore oil fields being sought by Pan Minerals and welcomes the opportunity to assist. For commercial reasons, the details of the opportunities must remain confidential at this stage.”
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