Valiant Petroleum plc made the following announcements regarding its Tybalt and Viola exploration prospects.
Valiant announced that a farm-out has been agreed between its wholly owned subsidiary, Valiant Exploration Limited (“VEL”) and Apache North Sea Limited (“Apache”) for the Viola North prospect (Licence P1629, Block 30/18b) which is anticipated to drill in the summer of 2010. Apache will pay 75% of the well costs for a 50% stake in the prospect, subject to a cap on the promoted costs. Apache will also participate in the drilling of a second exploration well, (expected to be in the Viola South prospect) if approved by the operating committee, on the same terms. The agreement also provides for Apache to become Operator in the event of a commercial development.
The transaction remains subject to DECC consent and formal documentation which is currently being finalised after which VEL will retain a 50% working interest.
Valiant also announced that a farm-out has been agreed between VEL and Agora Oil & Gas (UK) Limited (“Agora”) for the Tybalt prospect (Licence P1632, Blocks 211/8c and 211/13c) which is anticipated to spud at the beginning of April 2010 with the Diamond Ocean Nomad semi-submersible drilling rig.
Valiant’s well costs will be partially carried by Agora for a 20% stake in the prospect, subject to a cap on the promoted costs. Following the farm-out, Valiant will remain as operator on the blocks and retain an 80% working interest. Agora will also have an option, exercisable within six (6) months of completion of the Tybalt well, to participate in the drilling of an appraisal well on the nearby of Banquo discovery (Licence P.212, Block 211/8a) and an exploration well on the Helena prospect (Licence P.296, Block 211/13a) on the same terms. The transaction remains subject to DECC consent.
Peter Buchanan, Valiant’s CEO, commented:
“We are extremely pleased to reach agreement on the farm-out of our two key exploration prospects during 2010. These transactions will help balance the risk and expenditure in our exploration portfolio while exposing investors to the large potential upside associated with these prospects. We look forward to working together with our new partners in the coming months.”