CityView’s share in the North Matanda PH72 oilfield will be effectively doubled under this agreement to a net 40% interest in the project and will in turn allow CityView to gain operational control of the North Matanda oil field via its controlling interest in Turnberry Resources.
Petro Energy Africa is also in advanced negotiations with the Cameroon Government for access to other certain key oilfields in the region. The parties aim to bring these negotiations to successful conclusion within the next month.
If CityView elects to proceed with the 100% acquisition it will pay US$4.5 million in cash and allot US$15 million worth of shares to the existing shareholders of Petro Energy Africa.
CityView CEO Mr. Mark Smyth said the acquisition of Petro Energy Africa will open up new opportunities in Cameroon.
"Cameroon’s stable business climate has already provided world class projects such as the Mbalam Iron Ore Project for Sundance Resources Limited," he said.
"Gaining operational control of North Matanda will allow us to better dictate both the schedule and strategic direction of the project to ensure maximum shareholder return. However, more importantly, CityView will gain access to a new host of exciting resource opportunities within Cameroon."
The North Matanda block (1187 km2) PH-72 (former OLHP-3) is situated in the northern region of the Douala/Kribi-Campo basin covering the upper half of the Wouri Estuary and surrounding onshore areas. The block is divided between part onshore and shallow offshore. Condensate was discovered in two wells drilled to a depth of 3,000 meters in the permit by Gulf Oil USA during the 1980’s.
Condensate prices from this region historically trade at a premium of US$3 to the price of Brent crude oil. West African condensate prices currently exceed US$80 per barrel.
CityView’s technical teams are currently conducting a feasibility study on how best to achieve commercial production from North Matanda.
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