GCIBPC extends Goudron licence to 2030 with new ESPC
(LON:BPC ) said it has signed the Goudron Enhanced Production Sharing Contract ("ESPC") at its Goudron Block in Trinidad and Tobago.
The Caribbean and Atlantic margin focused oil and gas company said the ESPC grants the group the continuing exclusive right to extract petroleum at Goudron until 30 June 2030.
The EPSC, which replaces an existing 10-year production sharing contract that was due to expire at the end of 2020, was entered into by Bahamas Petroleum after it had received consent from the Trinidad and Tobago Ministry of Energy and Energy Industries.
The signing of the Goudron EPSC was anticipated earlier in 2020 but had been delayed as a result of delays to obtaining the necessary consents arising from the Covid-19 pandemic.
The Company told investors that the terms of the EPSC are ‘largely consistent’ with the terms that previously prevailed under the existing Goudron Production Sharing Contract.
The Goudron Block currently accounts for approximately 40% of BPC's baseline daily production in Trinidad and Tobago. The company holds a 100% interest in the Goudron field via its current IPSC with Heritage, with this interest to be reflected in the new EPSC.
As a consequence of the ESPC, the Company will now proceed to issue 35,759,140 new ordinary shares in BPC, the issue of which was conditional on signing of the Goudron EPSC.
Shares in Bahamas Petroleum Company have increased by over 20% since the beginning of November 2020 to open 1.75% lower this morning following the announcement.
Reasons to Follow BPC
Multi-Asset Company
BPC is becoming a multi-asset ‘full cycle’ oil and gas company, with a range of exploration, appraisal, development and production assets and licences, located offshore in the waters of The Bahamas and Uruguay, and onshore in Trinidad and Tobago, and Suriname.
Positive Newsflow
The company is currently on-track for drilling an initial exploration well in The Bahamas, Perseverance #1, in late 2020 / early 2021, with the well targeting recoverable P50 prospective oil resources of 0.77 billion barrels, with an upside of 1.44 billion barrels.
Successful Acquisitive Growth
As a result of its merger with Columbus, BPC has been granted access to high-impact exploration wells in The Bahamas, five producing fields, two appraisal / development projects Trinidad, and an expansive frontier exploration acreage offshore Uruguay and Suriname.
BPC believes the merger will allow both groups to provide something different from within that business cycle to the combined entity and that together the asset base is ‘more robust, has broader interests and is, as a consequence, more financeable and thus more valuable.’
“With the completion of the merger of BPC and Columbus, we today become a single company, in pursuit of a single-minded vision: the creation of a revenue generating, full-cycle, Atlantic margin exploration and production business,” said Potter in August.
He added, “Going forward, BPC is an exploration and production business, intent on generating reliable, growing production cash flows capable of supporting exploration activities, and which together will create significant value for all stakeholders.”
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