Farm-In to JHI’s North Falklands Basin Licence
Westmount Energy Limited notes that Navitas Petroleum LP has executed a farm-in agreement to acquire a 65% working interest and operatorship of the PL001 North Falklands Basin Licence from JHI Associates Inc., with JHI retaining a 35% interest. Navitas will fund JHI's share of future exploration and appraisal costs up to $14 million via a loan-carry arrangement, repayable from 85% of JHI's future production cash flow. PL001, covering 1,126 square kilometres, is adjacent to the Sea Lion Project and contains significant exploration potential with JHI estimating 3.1 billion barrels of prospective recoverable resources, including two high-graded oil prospects, Tyche and Dinlas, each with a potential 400 million barrels. Westmount holds 1,500,000 shares in Eco (Atlantic) Oil & Gas Ltd. and 5,685,257 shares in JHI, representing approximately 6.24% of JHI's issued share capital.
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Westmount Energy Limited (UK AIM: WTE.L), the AIM-quoted oil and gas investing company focussed on high impact drilling outcomes in emerging basins, notes the announcements today by Navitas Petroleum LP ("Navitas")1 and Westmount investees JHI Associates Inc. ("JHI") 2 and Eco (Atlantic) Oil & Gas Ltd. ("Eco")3 pertaining to the execution of a farm-in agreement by Navitas and JHI under which Navitas will acquire a 65% Working Interest ("W.I.") and operatorship of PL001 North Falklands Basin Licence ("PL001"). JHI will retain a 35% W.I. which continues to be held via its wholly owned subsidiary JHI Falkland Inc. ("JHIF"). As consideration, in addition to payment of its share of JHIF's past costs in connection with the Licence, Navitas will fund JHI's 35% W.I. share of the costs associated with potential future activities, including an exploration well and potential appraisal well, up to an aggregate cap of USD$14M. This funding will be provided via a loan-carry arrangement repayable from 85% of JHIF's free cash flow from production under the PL001 License.
PL001 is located immediately to the west of PL032 containing the Navitas operated Sea Lion Project which recently achieved Final Investment Decision with respect to Phase 1 of this giant development complex with over 700 MMbbls of recoverable resources.
PL001, which covers approximately 1,126 square kilometres, is located in modest water depths (<500m), is fully covered by 3D seismic and contains significant exploration potential. JHI's internal Best Estimates indicate a prospect inventory containing an aggregate 3.1bn bbls of prospective recoverable resources with an aggregate upside of more than 10 bn bbls2. So far, two oil prospects, Tyche and Dinlas, have been high-graded within the same stratigraphic interval as the Sea Lion accumulation - each containing a potential 400 MMbbls recoverable2.
Westmount holds 1,500,000 shares in Eco. In addition, Westmount holds a total of 5,685,257 shares in JHI, representing approximately 6.24% of the issued share capital.
1https://maya.tase.co.il/he/reports/companies/1725338
2https://www.jhiassociates.com/north-falkland-basin
3https://polaris.brighterir.com/public/eco_atlantic_oil_gas_plc/news/regulatory_news/story/xe478nw
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