Sintana Energy, Inc (LON:SEI, TSXV:SEI, OTCQX:SEUSF) has announced that it has entered into a Letter of Intent providing for a period of exclusivity in relation to an investment providing for an indirect interest in PEL 37 in the Walvis Basin, offshore Namibia.
PEL 37
PEL 37 is located in the heart of the Walvis Basin, offshore Namibia, immediately to the north of PEL 82 currently operated by an affiliate of Chevron Corporation and where Custos Energy (Pty) Ltd, an indirect affiliate of Sintana, is a working interest owner. Chevron has previously announced its intention to accelerate exploration activities on PEL 82 including drilling an exploration well. Custos is carried for the initial operations.
PEL 37 is currently held 100% and operated by Paragon Oil and Gas Pty Ltd, a local Namibian company. PEL 37 covers an area of 17,295km², in relatively shallow water (100 – 1500m), with identified prospects at water depths between 300 and 600m, and with multiple large fans directly overlying a proven, mature oil-prone Aptian source rock.
The LOI provides Sintana with a period of exclusivity, initially through to 30th April 2026, to undertake technical, commercial and legal due diligence on Paragon and PEL 37, and to negotiate appropriate terms and documentation for contribution of capital by Sintana to enable work obligations to be satisfied, and which would result in Sintana becoming a shareholder of Paragon and thus an indirect holder of an interest in PEL 37.
Sintana will pay a deposit of $1 million to secure the exclusivity, of which 1/3 is non-refundable in the event that Sintana, for any reason, elects not to proceed.
Robert Bose, CEO of Sintana, said: “The LOI we have entered into provides, at low cost, exclusivity over a material indirect interest in PEL 37, which is a high-impact block at the heart of the Walvis Basin. In particular, PEL 37 is immediately adjacent to PEL 82, where we already have an interest and where an initial exploration well is expected over the coming quarters. Investing for a material stake in PEL 37 would thus afford additional optionality associated with upcoming activity in our existing portfolio. In the coming months, and with the benefit of the exclusivity secured, we will undertake the work needed to assess whether we wish to pursue this strategic expansion of our core portfolio – further announcements will be made in due course”.
