Touchstone Exploration has finalised a transformative acquisition in Trinidad, securing a pivotal gas-producing asset that enhances its production capabilities and market reach.
Touchstone Exploration Inc. has successfully closed the acquisition of Shell Trinidad Central Block Limited (STCBL) for approximately \$28.4 million. This strategic move grants Touchstone a 65% operating interest in the Central Block, an onshore exploration and production licence in Trinidad encompassing around 6,699 gross acres. The remaining 35% interest is held by state-owned Heritage Petroleum Company Limited.
The Central Block includes four producing natural gas wells and a gas processing facility, contributing approximately 3,200 barrels of oil equivalent per day to Touchstone’s production. This acquisition not only bolsters Touchstone’s production base but also provides access to the liquefied natural gas (LNG) market through existing gas marketing contracts, including two with the Atlantic LNG facility.
To finance this acquisition, Touchstone secured a new \$30 million six-year non-revolving term loan facility. The loan agreement includes revised financial covenants and a two-year extension of the maturity date of the existing revolving loan facility. Touchstone intends to fully draw the \$30 million under the new term facility to finance the acquisition and meet obligations under the amended lending arrangements.
This acquisition aligns with Touchstone’s strategy to expand its portfolio of high-quality assets in Trinidad. The Central Block’s proximity to Touchstone’s existing Ortoire block offers potential synergies for natural gas egress and marketing from future discoveries. Additionally, the infrastructure associated with the Central Block provides processing and takeaway capacity for natural gas in the Herrera fairway, enhancing operational efficiency.
Touchstone Exploration Inc (LON:TXP) is a Canadian-based, international upstream oil and gas company currently active in the Republic of Trinidad and Tobago. Primera Oil and Gas is the Trinidadian subsidiary of Touchstone.
