Page 14 - LatAmOil Week 16 2022
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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.



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