Upon approval by the ANH, the 50% economic interest in the PUT-7 Block that Suroco is to acquire pursuant to the Agreement will convert into a full 50% undivided working interest.
The terms of the royalty payable to PCR pursuant to the Transaction will allow for transportation costs, marketing and handling fees, government royalties and the 1% 'X' factor payment to be deducted from production revenue prior to the royalty being paid. Pursuant to the Agreement, Suroco would be liable for funding its 50% interest share of the work program on the PUT-7 Block, effectively on 'ground-floor' terms, with no promote. The work program on the Block is expected to include a 3D seismic program in late 2014 and the drilling of two exploration wells in late 2015. In order to fund the majority of its share of the proposed 2014 seismic program, Suroco has completed a US$5 million loan from an existing shareholder which the Corporation expects would be repaid upon completion of its recently announced agreement with Petroamerica Oil Corp. ("Petroamerica") to sell all of the Corporation's issued and outstanding common shares to Petroamerica (see the Corporation's April 28, 2014 news release).
Petroamerica gained the WI in PUT-7 when they acquired Suroco. From Petroamerica's press release dated August 19th:
On July 15, 2014 the Company announced the closing of the previously announced plan of arrangement under the provisions of the Business Corporations Act (Alberta) among the Company, Suroco and the shareholders of Suroco (the “Arrangement”) which was voted on and overwhelmingly approved by holders (“Suroco Shareholders”) of common shares (“Suroco Shares”) of Suroco at the reconvened Annual General and Special Meeting of Suroco Shareholders held on July 14, 2014 (the “Meeting”). Holders of over 78% of the outstanding Suroco Shares voted at the Meeting, with approximately 91.5% voting in favor of the Arrangement. The Arrangement also received approval from the Court of Queen's Bench of Alberta on July 14, 2014.
The Company holds a 50% WI and operatorship in the PUT-7 Block, acquired in May 2014 by Suroco, located in the Putumayo basin covering 130,184 gross acres and adjoining the western side of the Suroriente Block, subject to final approval by the ANH. To acquire this WI, Suroco agreed to pay $141,000 relating to a portion of the back costs incurred on the block and to pay a 10% royalty on Suroco’s share of production on this block to a former WI interest participant in the block.
Thanks for the clarification. Maybe they get compensation for the services rendered. The bank guarantee would be the smoking gun that could put us back in the game.
if they used JPR's services and bank guarantee, they need to 'pay the bill' - could just go to arbitration, GGLR should get something in return, but it might not be the 10% carried interest stake
I don't know the legal technicalities, but it sounds like JPR stupidly helped PCR without a contract in hand. As for PUT6, does GGLR retain any rights to put together a new joint venture?
Ok - so PCR, which GGLR had the deal with, says they are completely out, having transferred ownership to the new firms? I think they have an over-riding royalty on the production?
PCR is out of the deal now. Petroamerica owns the 50%. Are your saying the gov't may nullify the deal and force a settlement? I don't follow what you are saying about switching out, forcing management change or the reason for buying out PCR. If the ANH finds GGLR position has merit, then shouldn't it end up with the original terms? Does PCR own the other 50%? Is that where the settlement would come from and is that the position Key's funding would buy?
If PCR didn't file with the govt saying GGLR had a farm in stake, then there is the question of did PCR defraud and use GGLR property to file with the govt , if yes, and if the govt does not give PCR any special favors, then there is a case for GGLR ... Obviously in the end there will need to be a new operator, switching out PCR or forcing a mgmt change - if Key Capital raises the funds, they might be able to buy PCR as end result of a settlement
I'm not an attorney, and PetroCaribbean obviously acted in bad faith, but it doesn't sound like GGLR has a case. As I recall, GGLR was named in a press release as a joint venture partner with a 10% carried interest, weren't they? Who put out that release?
It reads like PetroCaribbean asked JPR to help with the paperwork and financial backing, he said, ok, here's the price, with GGLR getting 10% carried and an option on further stake ... PCR then took the work and used the bank guarantee that JPR prepared and arranged, but they didn't send back a signed contract - instead waited a while and resold the stake
My guess is that they'll wait until April to raise the price
If the Announce it between 15 Nov and January - that'll give the guidance for the state budget staff to calculate everyone's spending budget for the fiscal year beginning in April
In the meantime, BP/RIL, GSPC, etc will keep lobbying - the global natural gas prices are dropping for LNG delivery, so they have less $20/unit reference points ... they still might be able to get $6.50 out of India
Does this say anything anything about the true prospects or is it more likely that they had to focus on their best prospects in the short term?
Modi used the state-owned companies to build his resume to rise to national power. Now that he has it, he is making the politically popular decision to keep gas prices down. He has cover to raise prices to the level agreed upon by the previous administration. I wouldn't be surprised if it came in a little less.
I'm still trying to figure out how or why GGLR would be deemed out of the original deal with PetroCaribbean.
Are those per day statistics? If not, we're talking about $4.5 million of total production.
Australian oil and gas exploration company Range Resources has decided to not move forward with the farm-in option for the PUT-6 block in Colombia's Putumayo basin, instead doubling down on opportunities in Trinidad and Tobago.
The move follows the company's May departure from the PUT-7 block, also located in Colombia's Putumayo basin. In the latest announcement Range noted it is writing off US$3.48mn related to a performance bond issued to fund work commitments on PUT-6.
"To minimize our cost exposure on all fronts, we have taken pragmatic steps to exit our position in PUT-6 and PUT-7 blocks, where the work program would have been very expensive for Range," CEO Rory Scott Russell stated in a release. "I am particularly pleased that we will maintain our exposure to Colombia at a minimal cost."
Petroamerica Oil Corp. (TSX VENTURE:PTA) ("Petroamerica" or the "Company"), a Canadian oil and gas company operating in Colombia, holds a 50% interest in the Putumayo-7 block (subject to ANH approval) following a May 2014 farmin with PetroCaribbean Resources Ltd.
Petroamerica has recently become aware of an allegation made by GeoGlobal Resources Inc. ("GGR") in a press release issued by it and Key Capital Corporation on September 19, 2014 that GGR has a right to a 10% carried interest and an option for a 40% interest in the Putumayo-7 block.
Petroamerica, in consultation with its counsel, considers the allegations of GGR to an on-going interest and option in the Putumayo-7 block to be without merit.
Sept 25: 8GSPC floats tender for hiring of environmental monitoring services in Gujarat: GSPC has floated a tender for hiring of environmental monitoring services for drilling and production sites in its various onshore exploration and development blocks in Gujarat.
--The duration of the contract will be two years.
--The due date for submission of bids is November 6, 2014 (upto 16:00 hrs)
Click here for more information
8GSPC to hire consultant for re-engineering and re-vamping of its offshore and onshore facilities: GSPC has floated a tender for hiring of consultancy services for re-engineering and re-vamping of its offshore and onshore facilities in India.
--The bid submission date is November 6, 2014 (upto 16:00 hrs).
Click here for more information
8More tenders: Some more tenders floated by oil and gas companies are:
--Hiring of readily available bowsers, Duliajan [OIL] Details
--Provision for supply base at Kakinada [Cairn] Details
--Procurement of safety equipment for Ahmedabad, Tarapur and Unawa blocks [GSPC] Details
The DGH has disallowed drilling on a development well in the Sanand oil discovery in the GSPC's block CB-ONN-2002/3.
--Because of this, the development budget for 2014-15 has been reduced from $4.29 million to $2.44 million.
--The approved amount of $2.44 million will be spent on acquisition, processing and interpretation (API) of 3D seismic data (PSDM), testing of two wells, SE-3 and SE-4, and carrying out analysis, studies and other investigations during 2014-15.
--Along with this, a budget of $1.58 million has also been approved by the DGH for production from Miroli-1, Miroli-6 and Sanand oil discoveries.
--The two Miroli discoveries are expected to produce 10,010 barrels of oil, while the Sanand oil discovery is estimated to produce 33,272 barrels of oil and 84,150 cubic metres of gas.