PetroLatina Energy Gets ANH Approval Of Farm-out Agreement
November 04 2011 - 11:20AM
Dow Jones News
PetroLatina (PELE.LN), the oil and gas exploration, development
and production company focused on Latin America, Friday announced
that it has now received approval from the Agencia Nacional de
Hidrocarburos, or ANH, for the farm-out agreement entered into with
Shell Exploration and Production Colombia GmbH, an affiliate of the
Royal Dutch Shell group of companies, in respect of the Company's
VMM-28 exploration block.
MAIN FACTS:
-Under the terms of the agreement, Shell E&P Colombia will
acquire an 85 per cent participating interest in the Company's
VMM-28 Exploration and Production contract.
-The VMM-28 block is currently wholly owned and operated by
Petroleos del Norte S.A., PetroLatina's Colombian operating
subsidiary.
-In accordance with the terms of the farm-out agreement, Shell
E&P Colombia agreed to pay a total fee of $15 million in cash
to PetroLatina and the remaining $12 million is expected to be
received shortly.
-Shell E&P Colombia will be appointed as operator of the
contract and will take responsibility for the work program.
-The Company intends to use the proceeds from the farm-out
agreement to assist with the part funding of its planned ongoing
drilling program and development commitments in respect of the
remainder of its Colombian asset portfolio and for general working
capital purposes.
-Shares at 1447 GMT up 4.72% at GBP0.13875 valuing the company
at GBP16 million.
-By Jana Weigand, Dow Jones Newswires; 44-20-7842-9314;
jana.weigand@dowjones.com
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