Under the original terms of the Petroleos del Norte ("PDN") acquisition, a second cash payment of US $13 million was due upon the extension of the license. However, PetroLatina has now reached agreement with the vendors of PDN to make a cash payment of US $7 million and to issue to the vendors new PetroLatina shares to the value of US $3 million. The vendors of PDN now form part of the operational management of PetroLatina.
As part of the agreement to secure the license extension, Ecopetrol S.A., the Colombian state oil company, will increase its participation in the Los Angeles and Santa Lucia fields from 50% to 60%. The agreed work program for these two fields now includes six development wells and four exploration wells over the next two years.
The agreement has been ratified by the board of directors of Ecopetrol. In order to legalize the agreement, it is necessary to create a joint working team put together by PDN and Ecopetrol to prepare and submit the license Amendment to the Hydrocarbon National Agency (Agencia Nacional de Hidrocarburos "ANH").
PetroLatina is also in detailed discussions to secure the financing required for the planned drilling and development. This facility will enable the Company to enter the second phase of the development program in Colombia and increase cash flow dramatically.
Greg Smith, Chairman and Founder of PetroLatina, said:
Most Popular Articles
From the Career Center
Jobs that may interest you