Africa Oil Corp (TSX:AOI), and its partners in South Africa, have struck a farm-out deal to bring with TotalEnergies EP and QatarEnergy into the Block 3B/4B offshore exploration asset in the Orange basin.
It sees Africa Oil’s stake reduce to 17%, from 26.25%, and transfer operatorship to Total.
In return, the company sees some $46.8 million of value from the deal – comprising $10 million of staged cash payments plus ‘carries’ on the envisioned joint venture including spending to advance the project for up to two exploration wells.
“Attracting TotalEnergies and QatarEnergy as our new partners in Block 3B/4B is an endorsement of the exploration potential of the block,” Africa Oil chief executive Roger Tucker said in a statement.
“These opportunities are on trend with the discoveries in Namibia's Orange Basin, including Venus in Block 2913B. Both companies have deep geological knowledge of the basin with successful nearby discoveries.
“TotalEnergies, as the new operator, also brings extensive deepwater drilling and development expertise.”
Tucker added: “Africa Oil has an unrivalled position amongst its Independent E&P peer group in this world-class basin. This includes our indirect interest in the Venus discovery and the on-going appraisal and exploration campaign on Block 2913B."
Going forward the Block 3B/4B project equity split will be: TotalEnergies as operator with a 33% interest, Qatar Energy holding 24%, Ricocure with 19.75%, Africa Oil with 17%, and Eco retains a 6.25% interest.