PetroMagdalena Enters Colombia Farm-In with Interoil
PetroMagdalena Energy Corp. has entered into a binding letter of intent with Interoil Colombia E&P Inc. in respect of a 50 percent participation to farm in to the LLA-47 block located in the Llanos just south and on trend with the company's main Cubiro block and other producing blocks in the basin.
The LLA-47 is located in the prolific Llanos basin and covers an area of 173 square miles (447 square kilometer). Interoil has owned a 100% of the working interest on the block and is the current operator. The Company has agreed to undertake a $30 million work program commitment in the three years of Phase 1 of the E&P contract with the ANH. This transaction is subject to approval by the ANH. In addition, the Company shall pay a $2 million signing fee upon receipt of ANH approval.
Luciano Biondi, Chief Executive Officer of the Company stated, "We are looking forward to working with InterOil and expanding the cooperative relationship developed over the last few years as we have adjacent operations with their Altair Block on the southern boundary of Cubiro. This allows us to leverage our in-depth Cubiro experience to an exciting new block with the same geological and surface characteristics and logistical aspects. With the existing 2D seismic indicating the existence of several exploration leads similar to those on the Cubiro block, that will be matured with 3D seismic as the first activity prior to exploration drilling, we are pleased to have added a very prospective Llanos exploration program to our portfolio."