Upland farms out Tunisian gas permit
London-listed Upland Resources has farmed out an 80% interest in the Saouaf gas permit to US player Pennpetro Energy, in return for the latter covering prior costs, the companies said on July 21.
Subject to approval from Tunisia's state-owned oil company ETAP, Pennpetro will also secure operatorship of licence, which hosts up to 10 gas prospects and leads with multi-trillion ft3 gross potential, according to Upland. Pennpetro and Upland will seek a one-year extension of the permit, currently due to expire on December 23, 2022, to allow time to acquire 300 km of new 2D seismic data and process existing data.
Pennpetro has agreed to reimburse Upland for 80% of its prior sunk costs at the project, amounting to £310,225 ($372,000), which will be paid in ordinary shares in Pennpetro.
The permit can also be converted into an exploration permit at its expiry date, which would initiate a three-year work programme involving the acquisition of 150 km of 2D seismic data and the drilling of a well to reach the M'cherga formation at a minimum depth 0f 1,500 m. If it is converted into an exploration permit, ETAP will assume a 50% interest in the project, while the interests of Upland and Pennpetro will fall to 10% and 40% respectively.
"Saouaf is a large-scale potentially multi-trillion cubic feet gas asset with multiple leads and prospects situated in near proximity to the TrasnsMed gas pipeline that supplies gas from Algeria through Tunisia and into Europe via Sicily," Upland chairman Bolhassan Di said in a statement. "Europe's energy needs have never been as vital as they are now and further developing this asset has potential to provide exceptional returns for investors upon success."