The two new exploration permits will cover a total of 3,893 sq. kilometers in the Guercif area out of the 13,750 sq. kilometers of the former reconnaissance license. Stratic and the operator of the permit, TransAtlantic Petroleum Corp, will each farm-out 50% of their respective interests to Sphere and in exchange Sphere will pay 100% of the costs of an initial three year exploration program on the new Guercif permits and will contribute to costs on the license to date.
The national oil company of Morocco, Office National des Hydrocarbures et des Mines ("ONHYM'") is carried for 25% of the costs during this exploration phase but pays its share of costs in the development phase. Stratic's net interest in the permit after the farm-out, but before ONHYM's back-in rights, will be 20%.
The Guercif exploration permits are for an 8-year term divided into three periods. The initial 3-year work program will include re-entry of an existing well and the acquisition of 300 kilometers of 2D seismic data. TransAtlantic Petroleum Corp. will continue as operator of the permits for this 3-year period.
Sphere is an oil and gas exploration company with a focus on west and north Africa and the Middle East, originally formed as a subsidiary of Sphere Investments Ltd., an Australian company quoted on the Australian Stock Exchange. It was recently spun out and established as an independent, private company in Qatar.
Commenting on the farm-out, Mark Bilsland, Chief Operating Officer said "This deal gives us the opportunity to continue to explore in the Guercif area at no cost to Stratic for the next three years, leaving us with a meaningful stake in the exploration upside in the two permits. The forward program is designed to re-evaluate technical data on a well drilled in the area many years ago and to provide new seismic data over one of the more prospective areas in the original reconnaissance license. We are delighted to be working with Sphere in this venture."
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