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Columbus Energy Announces Grant of Bonasse Licence Area

Source: www.gulfoilandgas.com 5/13/2019, Location: South America

Columbus, the oil and gas producer and explorer focused on onshore Trinidad with the ambition to grow in South America, is pleased to announce that it has been granted a Private Petroleum Licence for the Bonasse Licence Area in the South West Peninsula of Trinidad, which includes the Bonasse field.

Leo Koot, Executive Chairman of Columbus, commented:

"The grant of the Private Petroleum Licence (PPL) for the Bonasse Licence Area in the South West Peninsula ("SWP") of Trinidad, which includes the Bonasse field, is formal recognition by the Ministry of Energy and Energy Industries that Columbus has the right to exploit any oil and gas in the Bonasse Licence Area. Whilst, in some ways, this is merely an extension of the current de facto situation, I believe it is an important step in that it formally recognises our rights and grants us the regulatory certainty to continue with our operations and planned drilling campaign. Without it, we would not have been able to drill the upcoming well. The PPL and the underlying lease with Singh Estates provide a world class economic and regulatory framework to exploit any oil and gas in the Bonasse Licence Area. I am confident that even a modest discovery in the SWP has the potential to transform the Company. I would like to thank the Ministry of Energy and Energy Industries for their assistance in granting the PPL."

Background

As announced on 19 March 2018, the Company signed an Agreement for Lease with Singh's (Cedros) Estates Limited (the "Future Lease") that ensured the Company had access to approximately 1231 hectares in the South West Peninsula (the "Bonasse Licence Area") within which to conduct oil and gas operations.

The Future Lease was subsequently converted into a Deed of Oil Mining Lease ("Deed of Oil Mining Lease"). The Deed of Oil Mining Lease grants the Company exclusive rights to conduct oil and gas operations over the Bonasse Licence Area until 2046. The Deed of Oil Mining Lease was the foundation for the grant of the PPL by the Ministry of Energy and Energy Industries.

As announced on 17 April 2019, the Company is progressing the detailed technical work on the SWP, the Company has chosen a well location and is undertaking the necessary pre-drill activities to commence drilling in Q3 2019, subject to receiving relevant Governmental approvals. The grant of the PPL will assist in that approval process.

The PPL has a term of 20 years and may be renewed for successive periods of twenty years upon an application by the Company. The PPL has a Minimum Work Obligation that largely matches the obligations under the Deed of Oil Mining Lease, namely the workover of 3 existing wells, with the addition of the drilling of one (1) well in 2019. The Company expects that the Minimum Work Obligations will be met as part of the ordinary course of business, with the obligation related to the drilling of a well satisfied by the planned well in Q3 2019.

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Related Categories: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Industrial Development  Insurance  Investment  Mergers and Acquisitions  Risk Management 

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