New World O&G to Take Oil Concessions in Denmark
New World O&G has signed a non-binding letter of intent with Danica Jutland ApS, granting the Company a 65-day exclusivity period in which to undertake due diligence on two oil concessions totaling 4,107 sq km, located in the productive Jutland on-shore area in South Western Denmark ('the LOI'). Any potential investment by the Company would be in accordance with its investing policy as set out in its Admission Document.
- The LOI provides a 65-day exclusivity period to conduct due diligence on two concessions - License No. 1/09 and License No. 2/09, located on-shore in Southern Denmark ('the Licenses').
- The Company has engaged RPS Energy to undertake a Competent Person's Report in the form of a letter of opinion ('CPR') to assist New World in determining the prospectivity of the Licenses.
- Upon completion of the CPR and subject to the satisfactory completion of due diligence, it is intended that definitive transaction documents will be agreed in the form of a Farm-out and Operating Agreement with the Company being named as Operator, followed by New World being named on the Licenses for both concessions.
- The LOI contemplates (subject to due diligence including the CPR being satisfactory) a staged investment in 2D seismic, initially of US $2.5 million, followed by the right to acquire further interests on the basis of an agreed drilling program if the Company then decides to take the opportunity further. At completion of the initial stage, a 12.5% working interest in each of the Licenses would be transferred to the Company. Upon full completion of the earn-in work program, the Company has the option to obtain up to an 80% working interest in the project.
New World CEO William Kelleher said, "We are continuing to deliver on our previously stated investing policy, by bringing quality projects to the table. This region in Southern Denmark is relatively under-explored but is located at the center of the Southern Permian Basin with significant production in the immediate region. Our policy envisaged Europe to be part of the longer term strategy, however a good investment opportunity has arisen now, and the Board believes that the time is right to take advantage of the region's significant opportunities, with stable governments, and generally favorable investment regimes."