ADM Energy PLC (LON:ADME) inked a non-binding agreement with Eunisell Limited, a Nigerian owned oil and gas production solutions company, to potentially develop the Barracuda oil field in OML 141, in Nigeria.
Subject to due diligence, the parties envisage possible collaboration opportunities and Eunisell may provide vendor financing to achieve the scope of work that may be agreed.
ADM agreed in March to invest in the development of Barracuda with a deal to acquire a 51% interest in a Risk Sharing Agreement (RSA) for the field.
Barracuda was estimated in 2016 to contain 1.3bn barrels of oil in place. It has four existing wells and a fifth is slated to be drilled later this year.
ADM's internal estimate suggests that first oil of 4,000 barrels of oil per day may be possible in the second half of this year. The company additionally raised £1.22mln to support its plans for the project.
In today’s statement, ADM chief executive Osamede Okhomina said: "The collaboration agreement with Eunisell, one of Nigeria's leading providers of oil field services and facilities, paves the way to bringing another high-class partner into the ADM fold.
“With a customer base in the region featuring oil and gas majors, Eunisell has been a key facilitator for the Nigerian oil and gas marketplace for many years, helping operators to reach their production goals faster and at less capital costs.
“We look forward to building a relationship and are excited by the potential of working alongside them to support the development of our investments such as the Barracuda Field in OML 141."