Page 12 - AfrOil Week 13 2020

AfrOil PROJECTS & COMPANIES
AfrOil
CAMEROON
UK-BASED Tower Resources has declared force majeure on its operations at the Thali licence area offshore Cameroon.
In a statement dated March 30, Tower said it had taken this step in light of the consequences of the coronavirus (COVID-19) pandemic. “Petroleum operations in Cameroon have already been affected by consequences of the COVID-19 pandemic, including international travel restrictions, and the Republic of Came- roon introduced its own travel restrictions on March17,”itexplained.“Serviceprovidersare therefore temporarily limited in what they can do locally, as is Tower itself, and so the com- pany last week notified the Ministry of Mines, Industry and Technological Development (MINMIDT) of an event of force majeure under the terms of the PSC [production-shar- ing contract].”
The declaration will affect the company’s drilling plans in Cameroon. As of March 17, the company still had seven months left in its exploration programme and was due to spud a new well at the NJOM-3 site on or about Sep- tember 15. Now, though, it is no longer certain that it will be able to start drilling by that date. Accordingly, it has asked for an extension of its deadlines.
“The company has informed MINMIDT that at this stage it is still possible that NJOM-3 could be spudded prior to September 15, 2020, despite the force majeure, if the situation returns to normal quickly enough, but this is now inherently uncertain,” it said. “[However], in any event, the company remains committed to drilling NJOM-3 as quickly as possible.”
State of farm-in deal
Tower also said that the coronavirus outbreak had affected its discussions with OilLR on a farm-in agreement. It said it was “satisfied” that OilLR’s investors had the required funding to conclude the deal in line with the heads of terms (HoT) document signed in early March.
But it also stated that both sides had agreed that they could not wrap up the transaction “until the environment stabilises sufficiently for the project to move forward.” Additionally, it said that it might alter the terms of the farm-in deal under certain circumstances.
“The company is continuing discussions with other potential investors in the Thali PSC, and while it fully expects OilLR to complete the agreed farm-in as set out in the HoT, the company has also agreed with OilLR that in the event it receives additional offers of firmly committed funds which aggregate to more than $15mn, and if (and only if) OilLR is una- ble to make an escrow payment on an agreed schedule, then the company will have the right to reduce OilLR’s share of the total farm-out downtoaminimumof$5mntoaccommodate the other potential investors,” it noted.
This approach will help ensure that Tower can continue to access the funds needed for the project, even if drilling has to be postponed.
The Thali licence area, formerly known as Dissoni, lies in the Rio Del Rey Basin. It covers an area of 119.2 square km in waters ranging from 8 to 48 metres deep. According to an inde- pendent reserve report conducted by Oilfield International Ltd (OIL), the block may hold 149mn barrels of oil. ™
The block lies in the Rio Del Rey Basin offshore Cameroon (Image: Tower Resources)
 Liberia relies on imports for all of its fuel needs. The precariousness of its situation was exposed this year when incorrect stock checks at its fuel storage facilities and constraints at its port led to
months of fuel shortages.
This put pressure on the country’s economy,
which is already reeling from inflation and cur- rency depreciation. ™
Tower Resources declares force majeure in Cameroon
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w w w . N E W S B A S E . c o m Week 13 01•April•2020