Calima Energy sells stake in Namibia PEL 90 to Tullow Oil

Calima Energy has entered into an agreement to sell its interest in the Namibia PEL 90 licence (Block 2813B) to Tullow Namibia, a subsidiary of Tullow Oil, a leading deep-water operator with an outstanding track record in Africa. 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 US$2.0 million on completion. Success bonuses totalling US$10.0 million will be paid in two equal tranches (US$5.0 million) following the grant of a production licence 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.’

Note: Namibia PEL 90 interests prior to the sale were: Calima Energy (Namibia) 56% (Operator); Trago Energy 20%; Harmattan Energy 14%; NAMCOR 10%.

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