Grand Gulf Energy is the latest entry into Namibia’s oil and gas sector after executing an option agreement to acquire 70% of working capital in Block 2312 in Walvis Basin.
The option agreement involves acquiring 100% of Wrangel Pty Ltd., the applicant for a 70% working interest over Block 2312.
Grand Gulf paid an option fee of US$115,000 while US$100,000 will be paid in cash or shares.
Another US$325,000 will be paid post grant of PEL on exercise of the project option at Grand Gulf’s discretion.
A further US$200,000 will be paid in shares post grant of PEL on exercise of the project option at Grand Gulf’s discretion.
Upon exercise of the project option, approximately US$175,000 will be payable directly to Namibian
government agencies for Licence Fees (including the federal government’s Petroleum Training and
Education Fund (PETROFUND).
Also, following exercise of the project option, subject to entry into a consulting agreement on terms
acceptable to the parties, TSE will be paid a monthly retainer of US$7,500 per month, with a further
day rate of US$1,000 per day for any work done above 5 days in any given month with prior approval
from the Grand Gulf Board.
Wrangel applied for the block in partnership with Namibian-based oil and gas company TSE Oil and Gas (20%) and Namcor (10%).
Block 2312 is south of Chevron-operated PEL 82 and spans about 16,800km² in water depths of 1,400m to 2,000m, which is well within the capability of modern drill ships.
The block includes 6,100km² of 3D seismic and 4,700-line km of 2D seismic.
The previous operator of Block 2312 reported a mean prospective resource of 1.1 billion barrels of oil.
Grand Gulf has appointed Havoc Services Pty Ltd, a subsidiary of Havoc Partners LLP, as its corporate and technical advisor to assist in assessing the Block 2312 opportunity.
Havoc will also support the Company in identifying and evaluating additional frontier basin opportunities globally.
Under the terms of the agreement, consideration is only payable upon the successful granting of the PEL, offering Grand Gulf a low-cost entry into one of the world’s most prospective frontier basins.
