26th Jan 2017 09:17
LONDON (Alliance News) - NU-Oil & Gas PLC on Thursday said Marginal Field Development Co has signed a collaboration agreement with major drilling contractor COSL Drilling Pan Pacific Ltd to work together to secure marginal field projects.
NU-Oil shares were up 38% to 0.566 pence per share on Thursday morning, the best performer on AIM.
NU-Oil owns 50% of Marginal Field Development Co. The London-listed firm said the deal signed between the two companies "envisages delayed invoicing and payment terms that, in certain circumstances, will delay a significant portion of the cost of drilling until after the production of hydrocarbons."
Specific details of the commercial arrangement will be agreed on a project by project basis, to allow project-specific timelines and conditions to be accounted for.
In return for the commitment they are making, COSL Drilling will have the exclusive first option to provide drilling and other core services on projects that Marginal Field Development Co enters into, subject to certain conditions.
In addition, the pair have agreed to investigate the possibility of additional service, potentially including fabrication, being provided, through COSL Drilling, by sister companies, where such services can be offered on competitive terms, also subject to certain conditions.
COSL Drilling is part of of China Oilfield Services Ltd, which is controlled by China National Offshore Oil Corp. COSL Drilling operates a fleet of eight high specification jack-up drilling rigs.
"The collaboration agreement allows Marginal Field Development Co to work on a 'one stop shop' basis with COSL Drilling, as a partner in the Marginal Field Delivery Consortium, to access the entire range of services and increase efficiencies, with COSL Drilling offering beneficial commercial terms that should expedite Marginal Field Development Co's entry into projects and facilitate earlier development," said NU-Oil.
By Joshua Warner; [email protected]; @JoshAlliance
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