Petro Andina Resources announced that its wholly-owned subsidiary, Petro Andina (Trinidad) Ltd. ("PATL"), has entered into an agreement with Primera Energy Resources Ltd. and Primera Oil and Gas Limited to farm-in (the "Farm-In") to the interests of these companies in the Cory Moruga 'E' Block located in South Central Trinidad (the "Cory Moruga Block").
The terms of the Farm-In requires PATL to drill two exploration wells on the Cory Moruga Block to a minimum depth of 3,200 meters, with the initial well scheduled to be spud and drilling prior to February 28, 2010. PATL will earn a 50% working interest in the Cory Moruga Block by paying 95% of all costs, to a maximum of US $13.3 million for drilling and evaluating these two exploration wells. The Cory Moruga Block encompasses 7,443 gross acres and targets oil-prone prospects.
In connection with the Farm-In, an application will be made for PATL to become the operator of the Cory Moruga Block. PATL is an approved operator with the Ministry of Energy and Energy Industries of the Republic of Trinidad & Tobago through its participation in the Central Range Blocks in Trinidad & Tobago.
The Farm-In and transfer of operatorship are subject to approval by the Ministry of Energy and Energy Industries and the Ministry of Finance of the Republic of Trinidad & Tobago.
Following the completion of the plan of arrangement contemplated by the arrangement agreement among Petro Andina, 148196 Alberta Ltd., a wholly-owned subsidiary of Petro Andina ("Exploreco"), Pluspetrol Resources Corporation N.V. ("Pluspetrol") and 1462627 Alberta Ltd., a wholly-owned subsidiary of Pluspetrol announced on September 3, 2009, the Cory Moruga Block Farm-In will be held by ExploreCo. If the plan of arrangement is completed, shareholders of Petro Andina will receive cash as well as shares and share purchase warrants of ExploreCo.
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