African Petroleum announced that it has signed non-binding heads of terms and a binding exclusivity agreement with an undisclosed oil and gas company that is said to have a strong track record in offshore deep-water drilling, Energy-pedia reported.

Under the agreement, the incoming third party will acquire a 70% operating interest in the African Petroleum’s SOSP production sharing contract (PSC) in Senegal and the A1 and A4 licenses in The Gambia, Subsea World News informed.

The incoming third party will have an initial eight-week period of exclusivity, which may be further extended under certain conditions. African Petroleum and the other party will finalize all the negotiations with the governments of Senegal and Gambia.

According to the farm-in agreement, the incoming party will pay up to $8.5m to African Petroleum and will be responsible for fully funding of at least two deep water offshore wells at a gross cost of up to $35m per well, a 3D seismic acquisition, pre-stack depth migration (PSDM) processing/reprocessing, and potentially fund 100% and 85% respectively of further two wells at additional gross cost of up to $35m per well.