Oil and gas company Vast Exploration has closed its previously announced farm-out of a 90% interest in the Putumayo Basin of Colombia Block to a subsidiary of Sagres Energy.

Vast Exploration has signed the agreement in consideration for the company retaining a 10% carried interest during the first exploration phase.

The Block, which has an area of 148,000 acres, offers exploration upside on a structural trend with existing discoveries.

The Block is situated strategically between two blocks (CAG-6 and PUT-09) awarded to Pacific Rubiales and Talisman Energy, respectively.

The Block carries a royalty of 7% payable to the Government of Colombia in addition to the basic royalty scheme established under Colombia Law, being 8% for nearly 5,000bopd and increasing to 25% for a 600,000bopd field.

Sagres said it will have an option to acquire Vast Exploration’s carried interest in the Block over the next twelve months at a price to be mutually agreed.