Rialto Energy, Vantage Drilling Agree to $12.4M Settlement
Rialto Energy Ltd. and Vantage Drilling Company have settled an agreement regarding payment terms in regards to the early termination of the rig contract regarding Vantage's Sapphire Driller (375' ILC) jackup.
Rialto has agreed to pay Vantage an amount equivalent to 75 days of the operating rate, about $12.38 million. The original contract had specified a rate of $17.33 million for 105 days.
The company had contracted the rig until December 2013 to explore Block CI-202.
In April 2013, Rialto and Vitol E&P entered into a contract to jointly develop Rialto's interests in Cote d'Ivoire and Ghana. Vitol acquired, subject to regulatory and joint venture partner approval, a 20 percent stake in Rialto Energy (Ghana) Limited in exchange for funds to cover Rialto's $7.7 million obligation to drill the high-impact Starfish-1 exploration well in the Accra Block, Ghana – which is due to spud in June 2013.
Additionally, Vitol will acquire 65 percent of the shares in Rialto Energy (Cote d'Ivoire) Limited in exchange for providing $50 million of capital to be invested in a to-be-agreed Block CI-202 work program. The deal also called for the release of the Sapphire drilling rig, according to an April 23 press release.
"Whilst we are disappointed to have had to make the difficult decision to terminate the rig contract, it was made to ensure that Rialto and Vitol had sufficient time to finalize matters around our recently announced deal and to work together on a robust technical program in Block CI-202," Rialto's Managing Director Rob Shepherd said in a press release. "We are continuing to work with Vitol on finalizing the transaction and are doing everything possible to bring this to a swift conclusion."
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