Seychelles farm-out: WHL has signed a non-binding letter of intent with a potential farm-out partner UPSTREAM Josh Lewis 26 March 2013 02:50 GMT Australian company WHL Energy looks to have secured a potential farm-in partner for its acreage off the Republic of Seychelles. The company announced on Tuesday that it had signed a non-binding letter of intent outlining a forward work programme and indicative commercial terms. It added the letter of intent also included conditions for progressing the negotiation of fully-termed binding agreements, including a farm-in agreement and joint operating agreement. WHL managing director Steve Noske said there were a number of pre-conditions to be met before any legally binding farm-in agreement was signed but noted that the potential farminees technical capabilities and stature was “in line with WHL Energy’s stated aim of partnering with an organisation with the capacity to help take the valuable Seychelles asset forward”. A company spokesperson could not name the potential farm-in partner but said they were a major European-based oil and gas producer with a long history in Africa. Noske said negotiations with the company started in October last year following an initial meeting at the Africa Oil Week Conference in Capetown, where it relaunched the farm-out process. Any farm-in agreement would still be subject to government approvals, however Noske said WHL was hoping to have a final, commercial agreement in place during the month of June. WHL renegotiated the work commitments for its Seychelles acreage prior to the conference last year which will see it need to drill one exploration well prior to 31 January 2014 and shoot an additional 5000 kilometres of 2D seismic. However, at the time WHL noted that it had acquired an extra 3000 kilometres of 2D data on top of the original 5000 kilometre commitment, leaving it effectively only another 2000 kilometres to shoot. The company could not provide details of how big of a stake the potential farm-in partner would take in the 17,345 square kilometres WHL holds off Seychelles due to confidentiality agreements. Noske added that the two companies were also looking to potentially expand their relationship into a formalised partnership to bid for the upcoming open acreage in the Seychelles. WHL has previously stated its Seychelles acreage is estimated to hold mean prospective resources 5.5 billion barrels based on the 27 prospects and leads it has identified within the offshore area.
WHL lining up partner for Seychelles assets Dan Wilkie 26-Mar-201302:46pm Category: Resources Gas Oil WHL Energy has attracted the interest of a global energy giant to explore a potential farm-in agreement covering the company's Seychelles oil and gas assets. WHL said it had signed a non-binding letter of intent with a top 100 global Fortune 500 company, which it described as an internationally recognised exploration and production operator. The Seychelles acreage is located off the southern Seychelles coast off the coast of Africa, covering some 21,426 square kilometres of oil and gas exploration interests. International petroleum consultant Netherland Sewell and Associates estimated a prospective resource of 3.45 billion barrels of oil for 21 of WHL's most highly-ranked leads at Seychelles, comparing with WHL's own estimate of 4.03 billion barrels of oil for the same leads The agreement is not binding, but will set a timetable for discussions with the Seychelles government to advance the proposal, determine commercial terms of a potential farm-in agreement, outline principles for a forward work program for the assets, as well as conditions to progress the negotiation to a binding agreement. "There were a number of pre-conditions to be met before any legally binding farm-in agreement is signed," managing director Steve Noske said. "But the potential farm-inee's technical capabilities and stature is in line with WHL Energy's stated aim of partnering with an organisation with the capacity to take the valuable Seychelles asset forward." At close of trade today, WHL shares were up 3.8 per cent, trading at 2.7 cents. Tags: WHL Energy [1]
QFY Price at posting:
2.8¢ Sentiment: Buy Disclosure: Not Held
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