Africa Energy to acquire additional interest in South Africa
VANCOUVER -- Africa Energy Corp. announces the signature of definitive agreements to acquire an effective 4.9% interest in the Exploration Right for Block 11B/12B offshore South Africa.
Block 11B/12B is located in the Outeniqua Basin approximately 175 km off the southern coast of South Africa. The block covers an area of approximately 19,000 km2 with water depths ranging from 200 to 2,000 m.
Total E&P South Africa BV, a wholly-owned subsidiary of Total SA, is the operator and has a 50% interest in Block 11B/12B. CNR International (South Africa) Limited (CNRI), a wholly-owned subsidiary of Canadian Natural Resources Limited, owns the remaining 50%.
Africa Energy holds 49% of the shares in a new special purpose vehicle, Main Street 1549 Proprietary Limited, which has entered into farmout agreements with Total and CNRI separately to acquire 5% from each for an aggregate 10% participating interest in Block 11B/12B (4.9% net to Africa Energy).
Garrett Soden, Africa Energy's President and CEO, commented, "We are excited to partner with Total and CNRI on Block 11B/12B. This is a unique opportunity for a company of our size to work with majors in what we believe to be the most prospective geology offshore the African continent. Our technical team knows the area well from their previous exploratory work off the southern coast, and we look forward to the proposed exploration well on Block 11B/12B."
Africa Energy paid a deposit of $490,000 at signature and will pay an additional $6.86 million at closing. The company has agreed to fund a portion of Total's and CNRI's costs for the proposed exploration well to a maximum of $7.55 million, plus certain contingent payments due at various milestones associated with commercialization of hydrocarbons from Block 11B/12B. The closing, carry and contingent payments will be funded from cash on hand and/or from third party sources.
Closing is subject to standard conditions for a transaction of this type, including approval by the South African government and the TSX Venture Exchange, as required.
