Tower Resources: new Namibia petroleum agreement

Highlights:

• Blocks 1910A, 1911 and 1912B cover 23 297 km2 in the Walvis Basin and Dolphin Graben
• Initial Exploration Period of four years with a US$5 million work commitment
• Recent nearby farm-in activity by Exxon, Africa Energy and Kosmos Energy

The Company has previously advised shareholders that it has had a long-standing application with the Namibian Ministry of Mines and Energy (‘MME’) and has been working to conclude a PA, which was noted in the 2018 Interim Report to shareholders in September. The Company can now advise shareholders that the terms of the PA have been agreed with the MME and signed by all parties. Issuance of the licence remains dependent on the finalisation of a Joint Operating Agreement (‘JOA’) among Tower Resources (Namibia) Limited (80%, Operator), its carried interest partner Namcor (10%) and its local partner ZM Fourteen Investment CC (10%), and completion of other ancillary documentation.

The PA is structured to comprise an Initial Exploration Period of four years (which may be extended to five in appropriate circumstances), followed by options for Tower and its partners to enter a First and Second Renewal Period of two years each. The work programme for the Initial Exploration Period comprises regional play fairway evaluation and acreage high-grading activities including CRS mapping, sequence stratigraphy, sedimentology and basin modelling, geochemical, gravity and magnetics analysis, 2D/3D seismic interpretation and mapping, and petrophysics and well failure analysis, based on a data base build comprising:

• Acquisition of 5000 km of existing 2D seismic and relevant well data;
• Analysis and, if necessary, reprocessing of existing 2D data;
• Acquisition of at least 1000 km2 of 3D seismic data;
• Acquisition of oil seep satellite data and piston-coring reports.
• The minimum exploration expenditure for the Initial Exploration Period is US$5 million, which is to be supported by a bank guarantee of US$0.5 million.

If the Company elects to enter the subsequent exploration periods, these would each comprise a single exploration well commitment and a minimum financial commitment of US$20 million.

Jeremy Asher, Chairman and CEO commented:

“We are very excited about our new Petroleum Agreement in Namibia. As a company, we know Namibia very well, and the wells drilled in the Walvis Basin during the past few years have provided a much greater level of understanding of the regional geology. As a result, Namibia and the Walvis Basin and Dolphin Graben, in particular, are now attracting great attention from well-respected explorers, both large and small, and are also once more attracting considerable farm-in interest and investment”.

Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/07112018/tower-resources-new-namibia-petroleum-agreement/