Chariot expands offshore Angola position through Etu Energias Block 14 deal

Chariot Limited has signed a framework agreement with Etu Energias and BW Energy that will give the company economic exposure to future cash flows equivalent to approximately 4,000 bpd of oil production from producing assets offshore Angola.

The agreement is tied to Etu Energias’ acquisition of an additional 31% working interest in Block 14 and 15.5% interest in Block 14K from Chevron. Etu recently signed a $260 million agreement for the interests and intends to assume operatorship of Block 14, subject to regulatory approval.

Under the framework, Chariot and BW Energy will provide operational and technical expertise to support Etu as it expands its position and prepares to take over Block 14 operatorship.

In return for its services and support, Chariot will receive economic exposure to future cash flows equivalent to approximately 4,000 bpd. The company estimates the arrangement has an indicative net present value exceeding $100 million at a $60/bbl oil price.

“This agreement effectively doubles our economic footprint in Angola,” Chariot CEO Adonis Pouroulis said. He added that the partnership is intended to help the companies “realise the untapped potential of these material oil assets.”

Etu’s acquisition will increase its working interest in Block 14 to 60% and its interest in Block 14K to 30%. Block 14 currently produces approximately 42,000 bpd gross, with the interests being acquired from Chevron representing about 13,000 bpd of current production.

Shell Western Supply and Trading is providing the acquisition debt financing for Etu’s transaction.

Source: WorldOil