Cloudbreak Discovery PLC (LSE:CDL) announced a partnership with Ultimate Resources and Masterstroke Investments for a venture exploring for oil and gas in Namibia.
The London-listed company will be the financing partner in the venture which seeks to submit a petroleum development agreement and enter final negotiations for Petroleum Exploration Licence Block 2019.
It anticipates providing a financial guarantee of US$70,000 (£53,850) to the Ministry of Mines and Energy in Namibia for the first phase of the exploration programme, and, in return will earn a 20% interest in the Prosper Africa Resources Ltd joint venture company that will be the holding entity negotiating for the block.
Cloudbreak will additionally have the right to participate in all future equity offerings in Prosper for up to 10% of the offering.
"This agreement provides another exciting opportunity in Cloudbreak's diversification strategy into the energy sector,” said Kyler Hardy, Cloudbreak chief executive.
“The technical and management team we have partnered with has decades of experience in the international energy sector and specifically in the development of early-stage energy opportunities.
“We believe there could be significant opportunity across the energy sector for Cloudbreak through the deployment of our project generator model. I look forward to working closely with the team on the ground as we begin to realise the potential."
In Wednesday’s statement the company provided some details about Block 2019 which is located in the Waterberg basin, in central northeast Namibia.
It is anticipated that the next steps for exploration will involve the gathering of geophysical data and further delineate the basin to refine targeting of favourable stratigraphy on the exploration license, Cloudbreak said.