Africa Energy Corp. (AFE:TSX.V; AEC:NASDAQ) announced in a news release it signed two agreements to farm out part of its Block 2B in offshore South Africa in consideration for a carry through the next exploration well, Gazania-1, which is expected to spud by year-end 2020.
Specifically, the Canadian oil and gas company will farm out a total of 62.5% interest in Block 2B, 50% plus operatorship to Azinam and 12.5% to Panoro Energy. (Africa Energy owns 90% of Block 2B and is the operator whereas joint venture partner Crown Energy owns the remaining 10%).
In exchange, Azinam, a private Southern Africa-focused oil and gas exploration company, put down a $1.5 million deposit when the agreement was signed and will pay Africa Energy another $0.5 million at close along with a small part of Gazania-1 and other joint venture costs.
Panoro, a publicly traded, Africa-focused oil and gas exploration and production firm, will pay a small portion of Gazania-1 costs.
Africa Energy will retain a 27.5% participating interest in Block 2B, which, located in the Orange Basin, encompasses 3,604 square kilometers off of South Africa's west coast. Gazania-1 "will target a relatively low-risk rift basin oil play updip from the discovery," the release noted.
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