Ann: Guinea-Bissau Update, page-5

Not what I expected.

25 August 2017
Guinea-Bissau Update
• FAR awarded additional equity and improved deep water terms in the Guinea-Bissau Licences
• Licence periods have been extended to 25 November 2020
• Government Decree executed to approve additional equity and terms
FAR Limited (ASX:FAR) has received official confirmation that the increase in equity and amendments
to the Guinea-Bissau licences announced on 4 April 2017, have been approved by Government Decree.
These changes to Licence terms are consistent with FAR’s strategy to focus on the shelf edge areas of
the Sinapa and Esperanca Licences which display a similar geological setting to offshore Senegal and
FAR’s enormous SNE field discovery.
In early April, negotiations concluded with the
National Oil Company of Guinea-Bissau, Petroguin,
to revise the terms of both the Sinapa and
Esperanca Licences to which FAR has interests.
Under the revised Licence terms negotiated by FAR
and its joint venture partner Svenska Petroleum
Exploration AB (“Svenska”), FAR now have a
21.42% participating and paying interest in the
permits, an increase from the 15% participating
and 21.42% paying interests as previously
reported. These changes reflect the fact that
Petroguin will no longer have a participating
interest in the joint venture prior to a commercial
discovery. Upon making a commercial discovery,
Petroguin will have a reduced participating and
paying interest of 10% and FAR and Svenska will
respectively have interests of 19.28% and 70.71%.
In addition the new Licence terms negotiated include more favourable arrangements for deep water
investment including a reduction to production royalty rates payable to Government.
The Joint Venture has also been awarded a three-year extension to the current Licence periods, now
ending on 25 November 2020.
During these Licence periods, the Joint Venture will drill one exploration well on each Licence with a
minimum expenditure commitment for each Licence of US$3 million (gross).
These changes in the terms of the Licences have been now been approved by Government Decree.