Columbus Energy Resources has reached an agreement to acquire its joint venture partner’s share in the Icacos field, in the South West Peninsula of Trinidad.
Through its subsidiary Leni Trinidad (LTL), the company already holds a 50% non-operated interest in the field, while the remaining 50% is held by Touchstone Exploration subsidiary Primera Oil and Gas.
LTL is required to pay at least $500,000 for Primera’s current net 11 barrels of oil per day (bopd).
There is no upfront payment for the transaction and LTL has until 1 January 2021 to pay the consideration, with Primera receiving the net revenue it would have gained had it retained its interest.
Columbus Energy Resources executive chairman Leo Koot said: “We are pleased to have signed a sale and purchase agreement for the purchase of a 50% interest in the Icacos field and we look forward to quickly closing the transaction, further strengthening our position in the SWP, so that we can increase production from Icacos and integrate the acreage into our regional strategy.
“We are on track to building a core exploration, appraisal, development and potentially significant production hub in the South West Peninsula of Trinidad. In line with our ongoing focus on capital discipline, we are not expecting to pay any upfront payments for the Icacos purchase.”
In the event there is an increase in production, Primera will also be entitled to 25% of any net revenue above the current baseline.
Beginning 1 January 2021, LTL will have 100% rights over revenue from Icacos.
The company expects to fund all operational activities on Icacos from existing cash resources.
The Icacos field currently comprises six wells, with three on production. Last year, the field produced around 22bopd.
In order to increase production, Columbus plans to analyse the potential for a well reactivation programme and undertake well stimulation.
