Petrolia Energy has divested Indonesia-focused oil and gas firm Bow Energy to Blue Sky Resources (BSR), a privately held company with existing oil and gas operations across Indonesia.
Image: Onshore drilling. Photo: courtesy of Stuart Miles/Freedigitalphotos.net.
The Company will retain a direct 20% interest in all 5 Indonesian Production Service Contracts (“PSC”) held by Bow.
As part of this transaction, BSR has returned 70,807,417 shares of Petrolia, assumed all existing debt held by Bow, and committed to carry the Company for the initial $10 million development cost, including the drilling of two wells at the South Block “A” PSC.
Petrolia Energy chairman James E. Burns said: “When we acquired Bow earlier this year, we knew that local financial and operating partners in the region would be essential in commercializing these assets over the long-term.
“After a thorough review of the potential partners and offers, the Board decided that BSR provided the best proposal to monetize the Indonesian assets.”
Deal Point Highlights for Petrolia:
Secured a commitment of $10 million for CAPEX to initiate the regional development plan, including drilling of two wells at the South Bock “A” PSC.
70,807,417 shares of Petrolia’s common stock will be returned to Petrolia and cancelled.
Secured a 3% overriding royalty interest (ORRI) in Bohorok PSC., a prolific gas play.
Eliminated $1,696,332 outstanding debt.
Additional information regarding the disposition is included in the Current Report on Form 8-K filed today by Petrolia with the Securities and Exchange Commission.
Source: Company Press Release