FAR Ltd takes 100% ownership in The Gambia Blocks A2 and A5
Press Release
FAR Ltd (“FAR” or the “Company”) is pleased to announce that its wholly owned subsidiary FAR Gambia Ltd has recently acquired an additional 50% interest in Blocks A2 and A5 offshore The Republic of The Gambia, giving FAR a 100% working interest. The interest was acquired from PC Gambia Ltd a subsidiary of Petroliam Nasional Berhad (“PETRONAS”).
Highlights
· FAR has acquired a further 50% interest in Gambia Blocks A2 and A5 giving the Company a 100% working interest
· Commitment to drill an exploration well during the next two-year contract term removed
· FAR has initiated a process to find partners to fund the forward exploration programme
· New laboratory analysis has positive implications for the Panthera Prospect directly up-dip of Bambo-1.
The next two-year license term for Blocks A2 and A5 is due to commence on 1 October 2022 and as part of the acquisition, FAR has negotiated with the Government of The Gambia to remove the obligation to drill an exploration well during this term. The removal of the commitment to drill an exploration well results in a significant reduction in expenditure and allows for a detailed geoscience review incorporating the results of the recent Samo-1 and Bambo-1 wells to ensure future exploration wells are located optimally.
The Company has opened a data room forsuitably qualified parties to consider participation in a Joint Venture to undertake the geoscience review and ultimately to drill additional exploration wells. FAR expects new partners to fund the costs of the work programme. Subject to the satisfaction of certain conditions, including Government approval, incoming participants in the Joint Venture may assume Operatorship.
The 100% interest in Blocks A2 and A5 and the revised investment obligation enhances FAR’s ability to seek farm-in partners to the project while controlling any potential corporate action and process.
Commenting on the update, FAR Chairman Patrick O’Connor said: “FAR’s acquisition of the remaining 50% of The Gambia assets and the positive discussions with the Government of The Gambia on the terms for the First Extension Exploration Period will provide FAR options to utilise its valuable exploration data to maximise value from the asset. These developments have minimal impact on FAR’s forward budget while significantly improving the chance of securing new investment.
FAR remains committed to generating real value for our shareholders, and we see this transaction as a part of that overarching strategy.”
For the full press release, see here: https://far.live.irmau.com/irm/pdf/190a9491-46ed-46a3-bedf-4696334b0b51/FAR-takes-100-ownership-in-The-Gambia-Blocks-A2-and-A5.pdf
Lunn rewriting South Africa’s oil strategy- upstream
Ian Esau – upstream
The new bill going through parliament owes much to entrepreneur’s powers of persuasion and ability to thrive in “impossible” situations
Oil and gas entrepreneur Sean Lunn is determined to improve the socio-economic conditions of his native South Africa.
Despite legal challenges, he believes the nation’s hydrocarbon resources are “potentially so big and could make such a difference to our socio-economic environment, they cannot be ignored”.
A respected figure in southern African upstream circles, Durban-born Lunn and his wife Julie have their hands full with 10-year-old twin boys, also budding entrepreneurs it would seem.
After a decade or so in investment banking, 45-year-old Lunn sharpened his upstream acumen as Impact Oil & Gas’ country manager for South Africa and Namibia, and for seven years was also point man for the Offshore Petroleum Association of South Africa (Opasa) during its tough negotiations with government over upstream legislation.
See the full article here.
See more about FAR Ltd here.
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FAR Ltd appoints new CFO
Press Release
Appointment of Chief Financial Officer
FAR Limited (ASX: FAR) advises that Chief Financial Officer Victoria McLellan has resigned and Garth Campbell-Cowan has been appointed as Chief Financial Officer. Ms McLellan will finish with the Company at the end of April following a hand-over period with Mr Campbell-Cowan.
Mr Campbell-Cowan is an experienced executive, working across a variety of ASX listed organisations, including most recently as CFO of gold mining company St Barbara Limited. He has been appointed on a contract basis for the period of transition of the Company.
Chairman Patrick O’Connor commented: “I thank Vicky for her service to FAR over the past five years and wish her well in her future endeavours. I look forward to working with Garth as we focus on farming out our Gambian assets, exploring every opportunity to realise value for shareholders and seeking to reflect the underlying asset value in the FAR share price.”
For the full press release, see here.
FAR Ltd publishes its FY 2021 Annual Report
Press Release
FAR Ltd publishes its Annual Report for the year ended 31 December 2021. Please find the full report here.
FAR shareholder slates “inadequate” Samuel Terry bid
Australian explorer FAR’s major shareholder has rejected a takeover bid from Samuel Terry Asset Management.
Meridian Capital International Fund, which has a 19.28% stake in FAR, has suggested a distribution of rights to the contingent payment due from Woodside Energy.
Fellow Australian energy company Woodside was working with FAR at the Sangomar development, offshore Senegal. As the pandemic hit, FAR became unable to raise financing and as a result had to sell down its stake.
Woodside paid FAR $126 million in cash. It also committed to a $55mn contingent payment, based on commodity prices and first oil from Sangomar. This should come due in 2023.
FAR has a market cap of A$64.9mn ($46.1mn). Samuel Terry’s offer valued FAR at A$42.7mn ($32.2mn).
Meridian has called for FAR to hold a shareholders meeting on distributing the contingent payment rights.
“FAR is investigating whether it can do so in an appropriate way and will provide an update to shareholders in due course once this investigation is complete,” it said.
FAR released a letter from Meridian on the takeover offer. The bid “is opportunistic and wholly inadequate”, Meridian said.
The investor noted FAR’s cash backing, the contingent payment and its “existing oil and gas interests”.
Meridian suggested that FAR could find a way to trade the contingent payment rights “directly or indirectly on a listed/tradeable exchange”. All FAR’s other assets would remain within FAR, Meridian said.
FAR said it was investigating whether it could take the action.
Meridian Capital Rejects ‘Wholly inadequate’ Samuel Terry’s Bid for FAR Ltd.
Meridian Capital International Fund, a 19.28% shareholder of Africa-focused oil explorer FAR Limited, has rejected the takeover bid for Far launched earlier this week by Samuel Terry Asset Management.
Earlier this week, Samuel Terry Asset Management Pty Ltd as trustee for Samuel Terry Absolute Return Active Fund launched an offer to acquire FAR’s shares at 45c cash per share.
The bidder, which already owns a relevant interest in 4.9% of FAR’s Shares, said the offer price represented a premium of 23.3% relative to the closing price of FAR Shares on ASX on the Last Practicable Date (being 28 January 2022) of A$0.365 per share.
Australia-based FAR has interests in offshore blocks in the Gambia, Guinea Bissau and Australia. The company last year sold its stake in the Sangomar development offshore Senegal to Woodside. FAR had been working to sell its Senegal assets for months, as the company had been in default over the payments of its share of costs for the development of the $4.2 billion Sangomar project, after failing to secure a loan to finance its obligations. After the sale it shifted its focus on the Gambia and Equatorial Guinea assets.
Worth noting, while it did sell its whole Sangomar asset stake, FAR stands to benefit from Sangomar further, once the field is on stream.
Namely, after the sale, under the agreement with Woodside, FAR may receive future payments of up to US$55 million from the time of first oil production from the Sangomar Field which is targeted for 2023. These payments are contingent on future oil price being above US$58 per barrel.
Offer ‘opportunistic and wholly inadequate’
Meridian Capital International Fund (MCIF), which rejected Samuel Terry’s takeover bid for FAR, noted that FAR had said Monday that Samuel Terry offer undervalued FAR’s shares having regard to the company’s cash backing and the right of FAR to receive a US$55m contingent payment from the Sangomar deal, as well as its existing oil and gas interests.
“MCIF rejects the Offer at the Offer Price as being opportunistic and wholly inadequate. In particular, in MCIF’s view, the Offer does not offer shareholders any benefit from the [Sangomar] Contingent Payment.
“MCIF remains committed to its investment in FAR and would suggest to the directors of FAR that they convene a meeting of shareholders to consider a distribution of all rights to the [Sangomar] Contingent Payment to shareholders pro-rata to their existing equity shareholdings in FAR (Rights Distribution), ideally with such rights traded directly or indirectly on a listed/tradeable exchange.
“In MCIF’s view, that course of action or any similar arrangement approved by shareholders would help preserve the value of the [Sangomar]
Contingent Payment for existing shareholders on the relevant record date. All other assets including FAR’s cash and oil and gas interests would remain within FAR.”
Responding to Meridian’s proposal to consider a pro-rata distribution of rights to the contingent payment resulting from the sale of the FAR Senegal asset to Woodside, FAR said it was investigating whether it can do so in an appropriate way and that it would provide an update to shareholders in due course once this investigation is complete.
The Sangomar field, located approximately 100 km south of Dakar, Senegal, is expected to be Senegal’s first offshore oil field in production.
The $4.2 billion Final Investment Decision (FID) on the Sangomar field was taken at the start of 2020. The recoverable hydrocarbon reserves of the Sangomar field total approximately 500 million boe. The field is planned to be brought online in 2023 via a Modec-supplied FPSO named FPSO Léopold Sédar Senghor after Senegal’s first president.
The FPSO will be permanently moored at a water depth of approximately 780 meters. It will be capable of processing 100,000 barrels of crude oil per day, 130 million standard cubic feet of gas per day, 145,000 barrels of water injection per day and will have a minimum storage capacity of 1,300,000 barrels of crude oil.