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New World Oil and Gas Plc / Index: AIM / Epic: NEW / Sector: Oil & Gas 16 June 2011
New World Oil and Gas Plc (‘New World’ or the ‘Company’) Completes Definitive Transaction Documents for the Blue Creek Concessions, Belize.
New World Oil and Gas Plc, a company focused on making investments in the oil and gas sector, is pleased to announce that it has completed a Farm-Out Agreement (‘FOA’) to acquire up to a 100% participating interest in the Production Sharing Agreement (‘PSA’) over the Blue Creek Project in the Petén Basin in Belize and, furthermore, has entered into an operations agreement with respect to the PSA (the ‘Operations Agreement’). Additionally the Company has entered into a 2-D seismic acquisition agreement with American Seismic LLC and will commence the first phase of its seismic acquisition programme for the Blue Creek Project later this month.
The FOA was agreed between the Company’s wholly-owned subsidiary New World Oil and Gas (Belize) Ltd (‘NW Belize’) and Blue Creek Exploration Ltd (‘BCE’) which had the original agreement with the Government of Belize (dated 12 October 2007, as amended). The Operations Agreement was entered into by New World Oil and Gas (Belize Operations) Ltd (‘NW Belize Ops’), a wholly owned subsidiary of the Company, and BCE, whereby NW Belize Ops is named as operator of the Blue Creek Project.
Key provisions of the above agreements:
Upon the acquisition of 45 line km of 2D seismic data over the Project and re- payment of US$250,000 of BCE’s historical costs ($150,000 in cash and $100,000 in the Company’s ordinary shares to be issued at a price of 6.5p per share) BCE must transfer and assign 12.5% of its rights under the PSA to NW Belize.
Upon the acquisition of an additional 125 line km of 2D seismic data over the Project, BCE must transfer and assign a further 12.5% of its rights under the PSA to NW Belize.
Upon the drilling and completion of the first well through the Jurassic, BCE must transfer and assign a further 37.5% of its rights under the PSA to NW Belize.
Upon the drilling and completion of the second well through the Jurassic, BCE must transfer and assign the remaining 37.5% of its rights under the PSA to NW Belize. BCE will retain a 5% royalty interest following the assignment of 100% of its
participation rights under the PSA. BCE appoints NW Belize Ops as operator under the PSA with immediate effect.
New World CEO William Kelleher said, “We are very excited to announce the completion of these agreements for the Blue Creek Project which marks a huge step forward for our company. Being named operator under the PSA by our partners with the full support and agreement from the government demonstrates our team’s commitment and ability. We will shortly begin a two phase 2-D seismic acquisition and interpretation programme which will
bring us one step closer to reducing geologic risk in the licence area. This programme, set out under our farm-out agreement is designed to allow the Company to focus in on high grading subsurface prospectivity, before deciding on continuing to the next seismic acquisition phase and completing our further farm-in obligations. This is in line with our previously stated goals of high-grading the leads on the northern licence area under the PSA that are significant in size and potential, which closely resemble existing producing fields to the south, using our existing cash reserves and improving our chances of an early discovery.”
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For further information please visit http://www.nwoilgas.com or contact:
Enquiries:
New World Oil and Gas Plc
William Kelleher
Georges Sztyk Peter Sztyk
Beaumont Cornish Limited (Nominated Adviser)
Roland Cornish Felicity Geidt
Shore Capital Stockbrokers Limited (Broker)
Jerry Keen Pascal Keane
St Brides Media & Finance Ltd
Hugo de Salis Lottie Brocklehurst
Tel: +17134472171 +44 7901 502 053
Tel: +1514 961 2247 Tel: +19172157122
Tel: +44 (0) 20 7628 3396
Tel: +44 (0) 20 7408 4090
Tel: +44 (0) 20 7236 1177
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