TomCo Energy PLC (AIM:TOM, FRA:NI41) told investors Greenfield Energy LLC, now a wholly owned subsidiary, is progressing its deal to acquire an interest in 760 acres of land and assets in Uintah County, Utah.
This area is earmarked for the future mining of oil sands and construction of a commercial scale processing plant, based on the pilot facility used in recent tests by Greenfield.
Greenfield previously agreed to acquire 100% of Tar Sands Holdings II LLC, which holds the land, though an option deal that initially saw Greenfield pay up to US$2mln for 10%.
The option deal included a non-refundable US$200,000 deposit which secured a 90-day exclusivity period for due diligence, and, subsequently Greenfield has paid a further US$100,000 deposit to extend the due diligence period moving the deadline to pay the remainder out to October 1.
Assuming the deal proceeds, Greenfield will have until December 2022 to exercise its option to acquire the other 90% of the asset package.
“Whilst still ongoing, the due diligence undertaken on the site to date has been positive such that it appears ideally suited for the construction, subject to funding, of Greenfield's first commercial-scale plant,”
"Greenfield's focus is now on both progressing the necessary funding package in order to, inter alia, secure the initial 10% membership Interest and with the detailed planning to pursue construction of an initial 5,000 bopd facility at the earliest opportunity.”
TomCo noted that Greenfield is in advanced talks over a potential off-take deal related to the commercial-scale project, and, its due diligence for the site acquisition is substantially complete.
Greenfield has recently begun working with Stantec (TSX:STN) Inc, a global design and delivery firm, which along with consultant Netherland Sewell & Associates will conduct mine planning for the site together with a site reserves report and other preparatory work.
The proposed site has existing infrastructure, plant and equipment as well as an existing Large Mine Permit that could facilitate future development by Greenfield.
Today’s extension comes after TomCo last week agreed a deal to acquire all of Greenfield, which was previously a joint venture with Valkor.