Faroe Petroleum, the independent oil and gas company focusing on exploration, appraisal and production in the Atlantic Margin, the North Sea and Norway, announced that it has increased the size of the revolving credit facility with the Bank of Scotland to finance its Norwegian exploration and appraisal program, from NOK 120m to NOK 250m (approximately £25m).
This credit facility has been initiated to maximize the benefits of the Norwegian tax regime where exploration focused companies such as, Faroe Petroleum can recover 78% of exploration and appraisal related expenditure in the following tax year. Under the terms of the revolving credit facility, 75% of Faroe's exploration, appraisal and supporting expenditure in Norway will be met by the Bank of Scotland, quadrupling the Company's capital available for investment in Norway activity.
Chief Executive of Faroe Petroleum, Graham Stewart, stated, "The doubling in size of this facility since its launch last year reflects the considerable increase in activity taking place in our Norway program. The agreement ensures that Faroe Petroleum will continue to maximize the benefits of Norway's enlightened exploration focused tax regime, enabling us to make the best use of our financial resources. We are also very pleased to build on our long term working relationship with the Bank of Scotland."
Ashley Kelty, Associate Director of Oil & Gas commented, "We are delighted to be able to provide further funding to Faroe Petroleum to support their exploration program in Norway. This facility strengthens the ongoing partnership between Bank of Scotland and Faroe Petroleum, and illustrates the Bank's commitment to supporting customers to harness the significant potential which exists in Norway's Oil and Gas sector."
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