Chariot Oil & Gas Limited, the Atlantic margins focused oil and gas exploration company, announces that, through its wholly owned subsidiary Chariot Oil & Gas Investments (Mauritania) Limited, it has secured an option to back-in for between 10% to 20% equity in the C-19 block in Mauritania that has recently been awarded to Shell Exploration and Production Mauritania (C19) B.V., part of the Shell Group of Companies (“Shell”).
Background:
Chariot secured an exploration licence over the C-19 block in Mauritania in June 2012. The Company subsequently acquired 3500km2 of 3D seismic data and undertook extensive reprocessing of legacy 2D seismic data which led to the identification of a significant resource base in a number of plays, prospects and leads. The work undertaken by Chariot to derisk this block resulted in significant interest in farm-out data rooms from a number of potential partners, however the prevailing industry sentiment in a low-price environment was such that these did not lead to a transaction. As a consequence, in June 2016 the Company elected not to enter the First Renewal Phase which carried a well commitment.
Back-in Option:
In the intervening period Chariot has been working with Shell, SMHPM (the Mauritanian State oil company and a 10% partner in Block C-19) and the Mauritanian Ministry of Petroleum, Energy and Mines to secure a new exploration and production contract over the C-19 block. In recognition of the expertise and knowledge developed by the Chariot technical team and the potential contribution they can make through this expertise, Shell has offered the Company the option to back-in for a working interest of between 10% to 20% equity in the C-19 block at a future date, subject to the customary regulatory approval by the Mauritanian Ministry of Petroleum, Energy and Mines.
The Company is currently considering the merits of exercising this back-in option right and will up-date the market following any further material decision taken.
Larry Bottomley, CEO commented:
“The focus for Chariot is the delivery of transformational value through the discovery of material hydrocarbon accumulations. Chariot considers the C-19 block has the potential to deliver material hydrocarbon accumulations. The focus of our evaluation of the option will be on value, portfolio balance, risk management and capital discipline.
We would like to thank Shell for their constructive approach, participation and leadership in the process of
securing the C-19 block, SMHPM for their continuing support of our partnership and the Ministry of Petroleum, Energy and Mines for facilitating our attempts to progress exploration on this licence.
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