Swala Energy has announced that it is in farm-in conversations in Eastern Africa as the company seeks ways of raising alternative funding transactions.<\/p>\n
This follows the withdrawal of a share purchase plan by the company\u2019s board as the company aims at raising $5 million to finance its drilling obligations ahead of the planned in 2015.<\/p>\n
Swala which has already suspended its shares from trading since 24th November says the voluntary suspension may continue till 23rd December as the unnamed third party investor requested a period of exclusivity during which to carry out due diligence on the Company\u2019s assets.<\/p>\n
\u201cDuring this process a substantial third party has approached the Company to request, for consideration, a period of exclusivity during which to carry out due diligence on the Company\u2019s assets, with a view to concluding farm-in agreements on one or more of the Company\u2019s projects,\u201d reads the latest update by company secretary Adrian Di Carlo.
\nSwala adds it believes that the farm-in has the potential to have a material effect on the quantum, structure and terms of any fundraising.<\/p>\n
A likely target for the farm-in is the 25% share expected to be re-assigned in Kenya\u2019s block 12B from Spain\u2019s Compa\u00f1\u00eda Espa\u00f1ola de Petr\u00f3leos CEPSA after its decision to withdraw from the licence on 31st August 2014.<\/p>\n
The funds are to be applied to fund additional near-term work on the Company\u2019s Tanzanian and Kenyan licenses, as well as for business development and general administrative purposes.<\/p>\n
In particular to be used for additional work (particularly in Block 12B), basin modeling work and long-lead items for drilling in Tanzania, business development and general administrative expenditure.<\/p>\n
Among drilling set for 2015 includes a well in block 12B where the company has identified a series of ten leads and prospects from which one (\u2018Ahero \u2013\u201cA\u201d\u2019) has been selected as a drilling target to be drilled in the second calendar half.<\/p>\n
In Tanzania the company is in the process of interpreting data from a 200 km 2D seismic acquired over the Moshi Basin in the Pangani licence with preliminary interpretation of these new data allowing it to identify a number of potential structural leads which, after final processing of the field data, are expected to define potential targets for a 2015 drilling programme.<\/p>\n
Swala is however quick to say there are no guarantees of a successful outcome to these discussions although talks are ongoing to formalize its engagement with the theird party.<\/p>\n
Swala has a 29.2% net participating interest in the Pangani license, 29.2% net participating interest in the Kilosa-Kilombero license both in Tanzania and a 25% net participating interest in Kenya\u2019s Block 12B.<\/p>\n","protected":false},"excerpt":{"rendered":"