Oil and gas exploration firm Jacka Resources has completed the $12m farmout of the Odewayne block, located onshore in the Republic of Somaliland.
In November 2013, Jacka announced Jacka Resources Somaliland Limited’s (JRSL) farmout of a 15% participating interest in the Odewayne block to Sterling Energy.
JRSL and Sterling Energy (East Africa) have signed a farmout agreement for the Odewayne Block production sharing contract (PSC), which is currently in the third period expiring in November.
The PSC has an outstanding minimum work obligation of 500km of 2D seismic and the minimum work obligation during the fourth period of the PSC, which is due to expire in May 2016. The PSC covers block SL6 and part of blocks SL7 and SL10, onshore Somaliland, in a 22,840km² area.
The holders of the PSC now include Genel Energy Somaliland with 50% interest, Sterling Energy (East Africa) with 40% stake and Petrosoma with 10% interest.
Sterling Energy chairman Alastair Beardsall said that the company has built a material stake of 40% in the PSC and significantly lowered its cost of entry from $1m to $625,000 for each percentage.
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By GlobalData"Under the initial Jacka and Petrosoma transactions, Sterling would have paid US$25m for a 25% interest; we will now pay US$25m for a 40% interest in the PSC," Beardsall added.
Jacka has an option to acquire a 5% participating interest through its initial farm-in agreement with Petrosoma.
