Challenger Energy Group has entered into a farm-out agreement with Chevron Uruguay Exploration (a wholly-owned subsidiary of Chevron) for a 60% interest in the AREA OFF-1 block in Uruguay in a US$12.5m deal.
Under the terms of the agreement, Chevron will acquire a 60% participating interest in the AREA OFF-1 block and its operatorship in exchange for US$12.5m cash on completion of the transaction, with CEG retaining a 40% of non-operating interest. The purpose for the farm-out agreement is to facilitate and fund an accelerated 3D seismic acquisition (and associated interpretation work), with the intention of processing it during the initial four-year exploration period.
The transaction is still subject to customary third-party approvals from the Uruguayan regulatory authorities.
Challenger Energy Group plc (LON:CEG) is a Caribbean and Atlantic margin focused oil and gas company, with a range of petroleum assets located onshore in Trinidad and Tobago, and Suriname, and offshore in the waters of The Bahamas and Uruguay.
