Jersey Oil and Gas PLC (AIM:JOG, OTC:JYOGF) has confirmed the completion of its farm-out transaction with NEO Energy, which sees a 50% interest in the Greater Buchan Area (GBA) assets transferred to the AIM-quoted firm’s new partner.
At the same time, Jersey confirmed that it received the US$2mln initial payment for the deal.
Going forward, the company will now benefit from a full carry on some US$25mln of spending on GBA, covering its remaining 50% share, as the project is advanced through to an anticipated approval of a field development plan (FDP).
"We are delighted to have completed the farm-out transaction and to be swiftly moving forwards with finalisation of the GBA development solution,” said chief executive Andrew Benitz.
“With the route and the funding secured for preparation of the Buchan Field Development Plan, our attention now turns to unlocking further value by securing an additional GBA partner ahead of FDP approval and retaining a fully carried 20-25% interest in the development programme."
Certain milestone cash payments will meanwhile kick in as GBA progresses – with US$9.4mln due when the project’s development solution is agreed, followed by US$12.5mln upon approval of an FDP by UK regulators, and US$5mln respectively if additional FDPs are approved for the bolt-on J2 and Verbier discoveries.