Leni Gas & Oil plc today announces the formation of a partnership with Range Resources Limited ("Range") to jointly develop their interests in the Eastern Fields Area onshore southern Trinidad, including the Goudron and Beach Marcelle fields.
In a binding Heads of Agreement ("HOA") Range and LGO have agreed that, subject inter alia to full legal and technical due diligence (see Appendix below for Conditions Precedent):
· Range will acquire a 30% interest in Goudron E&P Limited ("GEPL") in return for contributing US$4 million at completion;
· For a further contribution of US$4 million during the first 12 months following completion Range will increase their holding in GEPL to 50%;
· LGO will operate the Goudron field during the initial work-over phase, but subject to Range exercising its option to acquire a total of 50% in GEPL, Range will become operator during the infill drilling and water flood phases;
· Range will obtain an accelerated return through 75% of the revenue interest until their initial investment is recovered;
· LGO will have the option to acquire a 15% interest in the Beach Marcelle waterflood project by contributing 22.5% towards the development costs (i.e. paying a 50% promote), up to US$7 million, towards the development costs;
· Range and LGO will work collaboratively to optimise and extend their joint interests in the Eastern Fields Area in Trinidad.
RRS Price at posting:
17.0¢ Sentiment: Buy Disclosure: Held