Range Resources announced that Range, Africa Oil Corp. and the Puntland State of Somalia have entered into amending agreements modifying the terms of the existing Production Sharing Agreements ("PSAs") made in respect of the Dharoor and Nugaal Valley Exploration Areas. The revised agreements were signed by the parties in Garowe, Puntland, subsequently approved by the Cabinet of the Puntland Government and are still subject to ratification by the Parliament of the Puntland State of Somalia which is scheduled for this week commencing December 14, 2010.
With the conclusion of the negotiations and the execution of the amending agreements, the PSAs, as amended, now provide for initial exploration periods in respect of both blocks that have been extended from 36 months to 48 months with a revised expiry of January 17, 2011. In addition, the terms of the exploration programs have been amended so that Africa Oil can, at its option, drill one exploratory well in each of the Nugaal and Dharoor Valley Exploration Areas, or two exploratory wells in the Dharoor Valley, during the initial exploration period.
In consideration of the extension of the exploration period, the parties agreed to voluntarily relinquish 25% of the original agreement
Onshore Puntland Interest consists of Range (20%); Africa Oil Corp (65%) and Lion Energy Inc (15%).
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