The Sales and Purchase Agreement will provide Baraka with a minor participating interest of the current and future production from TC Oil's interest in the La Punta oilfield (currently 1400 bbls/d on a 100% basis) as well as a participating interest in the gas liquids stripping business.
In addition, Baraka will also have a stake in the surrounding prospective block where the La Punta oilfield is located.
Baraka's investment includes entry fee, 3D seismic, to be completed before December 2007, and the drilling of one further development well with additional deeper exploration targets in the La Punta oilfield in early 2008. An additional contingent development well will be drilled if required.
While this investment can be funded out of existing cash reserves Baraka is reviewing a number of funding options in the short term.
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