Caracal Energy Inc. Announces Completion of Farm-In Agreement with Glencore
CALGARY, June 17, 2013 /CNW/ - Caracal Energy Inc. ("Caracal Energy" or the
"Company") today announced that it completed a previously disclosed Farm-in
Agreement (the "Agreement") with GlencoreXstrata plc ("Glencore") for the 25%
farm-in for the development of the Badila and Mangara oil fields in Chad.
Under the terms of the Agreement, Glencore will earn a 25% working interest in
the Badila and Mangara Exclusive Exploitation Authorizations (the "EXAs") with
Caracal Energy retaining a 50% working interest. Under the terms of a separate
agreement between Glencore and Société des Hydrocarbures du Tchad ("SHT"),
Glencore has acquired a further 10% working interest in the EXAs, with SHT
retaining the remaining 15% working interest.
Glencore, in consideration for acquiring the working interest in Badila and
Mangara from Caracal, will fund US$300 million of Caracal Energy's working
interest share of joint venture expenditures in the Badila and Mangara oil
fields up to a maximum of US$100 million per year (the "Carried Amount").
The effective date of the Agreement is July 1, 2012. Under the terms of the
EXAs, Caracal Energy and Glencore are required to fund SHT's costs, which are
reimbursed through cost oil.
Pursuant to the Agreement, Glencore acquired a 33.3% working interest in the
Exclusive Exploration Authorizations (the EEA's) granted under each of Caracal
Energy's three production sharing contracts in the Republic of Chad (the
"PSCs").In consideration for the assignment of the working interest,
Glencore paid to Caracal Energy approximately US$31 million on closing,
representing 33.3% of the Company's unrecoverable costs related to the three
PSCs as of July 1, 2012.
The three PSCs cover an area of 26,103 km(2) in southern Chad. The Badila and
Mangara oil fields have a combined size of approximately 100 km(2) and are
located within 95 kilometres of each other within the same PSC. The Badila oil
field covers an area of approximately 29 km(2) and is located approximately 16
kilometres from an oil export pipeline. The Mangara oil field covers an area
of approximately 71 km(2) and is located approximately 111 kilometres from the
same oil export pipeline.
Gary Guidry, Caracal's Chief Executive Officer, said:
"This transaction with Glencore is a very important step in the development of
the assets in Chad. We have been working with Glencore on this transaction
since July 2012 and we look forward to continuing the partnership as we drive
the project towards first oil production within the next few weeks."
Alex Beard, Head of Glencore's Oil Commodity Department, said:
"The closing of this transaction represents an important milestone in the
continued growth of our E&P business. In Chad, we have invested in a portfolio
of development and near term production assets with some exciting exploration
prospects and look forward to first oil production in the near future."
About Caracal Energy Inc.
Caracal Energy Inc. is an international exploration and development Company
focused on oil and gas exploration, development and production activities in
the Republic of Chad, Africa. In 2011, the Company entered into three PSCs
with the government of the Republic of Chad. The PSCs provide exclusive rights
to explore and develop reserves and resources over a combined area of 26,103
km(2) in southern Chad. The PSCs cover two world-class oil basins with
development opportunity, oil discoveries, and numerous exploration prospects.
FORWARD LOOKING STATEMENTS
Certain of the information contained in this press release constitutes
forward-looking statements under applicable securities law. Any statements
that are contained in this press release that are not statements of historical
fact may be deemed to be forward-looking statements. Forward-looking
statements are often identified by terms such as "may", "should",
"anticipate", "expects", "seeks" and similar expressions. Specific
forward-looking statements included in this press release include comments
related to the development of the Badila and Mangara fields and associated
timing, expected drilling results, expected testing results, expected
production rates and other matters.
Caracal Energy Inc. Gary Guidry, President and Chief Executive Officer Trevor
Peters, Chief Financial Officer + 1-403-724-7200
Longview Communications -Canadian Media Enquiries Alan Bayless Joel Shaffer
+ 1-604-694-6035 + 1-416-649-8006
FTI Consulting -UK Media Enquiries Ben Brewerton / Ed Westropp + 44 (0) 207
8313 3113 CaracalEnergy.email@example.com
SOURCE: Griffiths Energy International Inc.
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-0- Jun/17/2013 06:00 GMT
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