Canacol has entered into a definitive agreement with Sintana, the South American operations subsidiary of Drift Lake Resources, to farm out 30% of its 100% operated working interest on the COR 11 and COR 39 Exploration and Production Contracts located in the Upper Magdalena Basin of Colombia. The Corporation was awarded a 100% operated working interest in the E&P Contracts in February 2011 by the Agencia Nacional de Hidrocarburos.
Under the terms of the definitive agreement, Sintana will pay 60% of the work commitment costs associated with the Phase 1 Exploration Phase for each of the contracts in order to earn a 30% working interest in each of the contracts. The Phase 1 work commitments for the COR 11 E&P contract include the acquisition of 155 kilometers ("km") of 2D seismic and the drilling of one exploration well. The Phase 1 commitments for the COR 39 E&P Contract include the acquisition of 120 km of 2D seismic and the drilling of 2 exploration wells. The Phase 1 period for each of the contracts is 3 years in length, expiring in February 2014. Canacol shall remain the operator of both of the E&P contracts.
The Corporation will use the capital saved by the farm out of these blocks to fund exploration activities on its other blocks in Colombia.
Most Popular Articles
From the Career Center
Jobs that may interest you