News

August 18, 2009

Bowleven Set To Accelerate Etinde Work Rate As It Agrees US$225 Million Farm-In Terms With Vitol E&P

Bowleven looks set to push the button on its cluster of oil, gas and condensate discoveries offshore Cameroon after striking a farm-out agreement with Vitol E&P that could unlock a US$200 million capital investment programme in the promising Etinde Permit. Vitol, the E&P arm of Geneva-headquartered energy trading giant Vitol Group, will buy an initial 25 per cent in Etinde in return for funding a US$100 million gross work programme with the option to acquire a further 25 per cent interest for a further US$100 million capital injection and a US$25 million cash payment to Bowleven.

This is good news for Bowleven, providing a vote of confidence in what has been at times a troubled project as well as the financial flexibility to proceed with the necessary exploration, appraisal and development work to extract value from what looked, for a while, like another West African stranded gas story.  What’s more, Vitol’s marketing and development expertise should help Bowleven when it comes to monetize the discoveries on its acreage.

“This transaction, which...