Africa Oil has reported that further to the previously announced farmout agreement between Africa Oil and Maersk Olie og Gas A/S (Maersk) on 4th February 2016, the companies have agreed to payment terms related to the US $75 million advance development carry.
According to the announcement Africa Oil is due to receive equal quarterly payments of US $18.75 million at the end of each calendar quarter during 2018. Upon Final Investment Decision (FID) of the South Lokichar development project, Maersk may be obligated to carry AOC for an additional amount of up to US $405.0 million dependent upon meeting certain thresholds of resource growth and timing of first oil.
“We are very pleased to reach payment terms with Maersk. This agreement further strengthens our balance sheet as we move towards project sanction at the end of 2018,” says Africa Oil CEO, Keith Hill.
The Joint Venture Partners in the South Lokichar Basin are Tullow Oil plc (50% and operator), Maersk 25% and Africa Oil 25%.