26th Aug 2014 10:46
LONDON (Alliance News) - BowLeven PLC Tuesday said all parties involved in the LUKOIL/NewAge Etinde farm-out agreement have agreed to extend the longstop date by two months to October 31 to enable a number of conditions to be met.
BowLeven is working with LUKOIL OAO and New Age Ltd on the site offshore Cameroon.
BowLeven said the principal condition still to be met is approval by the Cameroon government of the transfer of the equity interest and operatorship. The approval process by the Cameroon authorities has commenced and the longstop extension provides additional time to enable logistical arrangements to be made for this important step in the process, BowLeven said.
The extension comes just months after BowLeven agreed to sell a 50% stake in the Etinde oil and gas permit, offshore Cameroon, to Russia's LUKOIL OAO and NewAge, for a total cash payment of USD250 million.
At the time, the oil and gas exploration and development company said it planned to reduce its interest in the Etinde permit to 25% from 75%, providing LUKOIL with a 37.5% interest and NewAge an additional 12.5% stake, bringing its holding to 37.5%.
The USD250 million payment is comprised of USD170 million on completion of the deal and a USD40 million deferred cash payment upon final investment decision for Etinde and the completion of appraisal drilling, with another USD40 million payment that Bowleven would have paid for two appraisal wells being covered by the buyers.
As a result of the deal, NewAge's subsidiary Camop will become the operator, allowing BowLeven to focus on its exploration plans in Cameroon, Kenya and Zambia, but the company will retain the 25% interest in Etinde to be exposed to its development.
BowLeven shares were quoted down 4.3% at 33.50 pence Tuesday morning.
By Anthony Tshibangu; [email protected]; @AnthonyAllNews
Copyright 2014 Alliance News Limited. All Rights Reserved.
Related Shares:
BLVN.L