Statoil to fund PetroFrontier exploration program in Australia
CALGARY -- PetroFrontier has agreed to amend the existing farm-in agreement with Statoil Australia Oil & Gas, with Statoil committing to spend the next $50 million, throughout the remainder of 2013 and 2014, to fully fund up to a 385-km 2D seismic program and the drilling and stimulation of four to six vertical test wells.
Throughout 2012 and the first half of 2013, PetroFrontier and Statoil jointly spent approximately $30 million on exploration in the Southern Georgina Basin, gaining valuable geological information. Under the amended agreement, Statoil could spend a total of up to $175 million by the end of 2016, before PetroFrontier will be required to contribute further. Statoil will also become the operator, effective September 1, 2013.
PetroFrontier said it is now positioned for new growth opportunities with working capital of approximately $11.3 million at March 31, 2013, no debt and reduced operating expenses going forward, as a result of the agreement.
Under the terms of the agreement, up to the next $160 million of exploration costs will be fully funded by Statoil, over three phases to the end of 2016, in return for 80% of PetroFrontier' s working interest in EP 103/EP 104 (100% WI), EP 127/EP 128 (75% WI) and EPA 213/EPA 252 (100% WI) in the Southern Georgina Basin, Northern Territory, Australia.