The Board of Centric Energy Corp. has announced the signing of the previously-announced farmout of its Mali acreage to subsidiaries of Heritage Oil Corporation.
The completion of the farmout was subject to a number of conditions precedent, including the approvals of the TSX Venture Exchange and of the Mali Government. The conditions precedent have now been fully satisfied by the recent approval of the transaction by the Mali Government, including the appointment of Heritage Oil Corporation as operator. Accordingly, the final documentation for the farmout has been signed by Centric Energy Corp. and Heritage Oil.
Under the terms of the transaction, Heritage has the right to earn a 75% working interest in Block 7 and Block 11 from Mali Oil Development SARL, a wholly-owned subsidiary of Centric Energy Corp. To earn the working interests, Heritage Oil will fund all costs of the required work programs for the next two years on both blocks, comprising the acquisition of 2D seismic and the drilling of one exploration well, at a total estimated cost for the two licences of between US$15 million and US$20 million. The acquisition of 2D seismic is expected to take place later this year.
Blocks 7 and 11 cover 72,000 square kilometers in the Gao Graben, a sparsely-explored Mesozoic basin that is considered to have geological similarities to other, highly-productive, Mesozoic interior-rift basins within North Africa, such as the Muglad Basin of Sudan and the Doba Basin of Chad, and Tertiary basins such as the Albert Basin in Uganda. Previous seismic data acquired on Blocks 7 and 11 show the presence of tilted fault-block traps, and indicate a thickness of up to approximately 4 km of sediments. Data from a detailed aeromagnetic survey flown at the end of 2006 by Centric Energy Corp. demonstrate the geometry of the graben and the areas of most interest for the 2D seismic acquisition.
Alec Robinson, President and CEO of Centric Energy Corp., states that: "With the completion of the farmout documentation, plans for the 2D seismic acquisition are being advanced as quickly as possible. Centric Energy is delighted to be working on the exploration of Blocks 7 and 11 with Heritage Oil, which has outstanding experience and expertise in this type of geological setting in Africa."
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