In March, FOGL signed a binding Heads of Agreement with its joint venture, BHP Billiton, allowing for the exit of BHP from the license, effectively ending the joint venture. Once conditions in the agreement are satisfied, the assignment of BHP Billiton’s 51% operating interest will transfer to FOGL. Due to the withdrawal, BHP will pay towards the costs of drilling the Loligo well, by placing funds in an escrow account.
If Loligo is a discovery, BHP retains the right to back-in to the Loligo project (the development area only). The company would have a maximum stake of 40% and it would have to contribute funds to future exploration and appraisal work.
The settlement with BHP Billiton will, coupled with other funds, provide enough cash resources to fund the Loligo well, and fulfill the phase one work commitment of the Northern License area. Furthermore, FOGL is considering additional drilling options. The site survey program is progressing with surveys already completed on three locations.
Most Popular Articles
From the Career Center
Jobs that may interest you