Page 14 - LatAmOil Week 16 2022

LatAmOil NEWS IN BRIEF LatAmOil

INVESTMENT
Rockhopper announces

Sea Lion project update

AIM-listed Rockhopper Exploration, the oil and
gas exploration and production company with
key interests in the North Falkland Basin, has
announced that, further to the heads of terms
notified on December 8, 2021, Rockhopper,
Harbour Energy and Navitas Petroleum have
signed legally binding definitive documentation
in relation to Harbour exiting and Navitas enter-
ing the North Falkland Basin.
The Transaction remains subject to comple-
tion pending, inter alia, regulatory approvals.
Highlights: Navitas will acquire Premier Oil
Exploration and Production Ltd (POEPL), the transaction announced in January 2020. The coupled with a more positive oil price environ-
Company in which Harbour holds all of its Falk- Transaction continues to materially satisfy Rock- ment, we are very excited to have them as new
land Islands licences. Rockhopper and Navitas hopper’s proportion of both pre-FID and post- partners and look forward to pushing ahead
will seek to align working interests across all FID costs for Sea Lion. Introduction of a new with Sea Lion, a world class resource.”
their North Falkland Basin petroleum licences and committed Operator for Sea Lion - Sea Lion Rockhopper Exploration, April 19 2022
(Rockhopper 35%, Navitas 65%, subject to all becomes Navitas’ largest operated development
necessary consents). Rockhopper and Navitas to asset. Access to Navitas’ expertise in executing Baron Oil requests
jointly develop and agree a technical and financ- and financing large scale oil field developments.
ing plan to enable the development of the Sea Clean exit for Harbour. Optionality for Tempo- relinquishment of
Lion project to achieve first oil on a lower cost rary Dock Facility: scope to upgrade for Sea Lion
and expedited basis post sanction. development or future decommissioning. legacy asset, Licence
Navitas to provide loan funding to Rock- Forward plan for Sea Lion: Transaction com-
hopper: The majority of Rockhopper’s share of pletion is subject to receipt of various agree- Block XXI in Peru
Sea Lion phase one related costs from Trans- ments, consents and approvals by the Falkland
action completion up to Final Investment Islands Government (FIG). Technical work to AIM-listed Baron Oil has announced that,
Decision (FID) will be funded through a loan commence by Rockhopper and Navitas jointly through its fully owned subsidiary, Gold Oil
from Navitas with interest charged at 8% per in relation to a lower-cost, alternative develop- Peru, it has requested the relinquishment of its
annum. Certain costs, such as licence costs, are ment for Sea Lion utilising the existing extensive legacy Licence Block XXI in Peru.
excluded. Subject to a positive FID, Navitas will design and engineering work undertaken for the As previously outlined, the Licence has been
provide an interest free loan to Rockhopper to project in recent years largely under Force Majeure (FM) for a variety
fund two-thirds of Rockhopper’s share of Sea Navitas to become Operator at completion: of reasons since 2017 and Baron has been frus-
Lion phase one development costs (for any costs Potential for an additional project partner trated in its attempts to access the area in order
not met by third party debt financing). Certain dependent upon funding requirements (to be to carry out operations. In our Interim Report
costs, such as licence costs, are excluded. Funds defined through ongoing development and of September 2021, we set out four require-
drawn under the loans will be repaid from 85% financing processes) should an additional part- ments necessary to progress the project, which
of Rockhopper’s working interest share of free ner be required, Rockhopper does not intend to were: confirmation that a three-year extension
cash flow. In the event that material progress reduce its working interest. Navitas committed option to the Licence is available; attracting a
towards FID has not occurred within five years to strengthen its offshore operating capability local farm-in operating partner; freedom to
of completion of the Transaction, Rockhopper with a focus on safe and efficient developments. conduct workshops with the local communi-
can elect to remove Navitas from the Falkland The Company also provides an update on ties; and drilling authorisation at the local level
Islands petroleum licences (should the licences the current cash balance which, as at March 31, from, amongst others, the regional president and
still be in effect at that time) by repaying the Pre- 2022, was $3.9mn (unaudited). The Company council. Regrettably, none of these criteria have
FID Loan. will require further funding for working capital been met.
Should material progress have been made, and to achieve Sea Lion FID. Under the terms of the Licence Agreement,
but FID not achieved, then the five-year period Samuel Moody, CEO, commented: “We are if the Licence is currently under FM and has
can be extended by 12 months and then a further delighted to have signed definitive documen- remained so for a continuous period of more
six months if certain project milestones have tation to bring Navitas into the North Falkland than 12 months, as is the case, the Licence holder
been achieved Basin. Subject to regulatory consents, we believe may ask Perupetro (the Peruvian national Oil &
Benefits of the Transaction: Greater align- this marks the start of a new exciting chapter for Gas Agency and Licensing Authority) to release
ment and simplified commercial arrangements the Falklands, and for the Sea Lion project in the licensee’s Bank Guarantee, which in this case
across the joint venture. Rockhopper retains particular. Navitas’ $1bn Shenandoah financing is $160,000. Thereafter, there will be a require-
a higher working interest in the Sea Lion pro- in 2021 proved their ability to fund challenging ment to establish and file an Abandonment Plan
ject than under the previous Premier-Navitas offshore oil and gas developments. Given this, for approval by the relevant authorities.

P14 www. NEWSBASE .com Week 16 21•April•2022