OilVoice - Bowleven Announces Cameroon Etinde Permit Farm-out

Bowleven Announces Cameroon Etinde Permit Farm-out

Thursday, August 13, 2009

Bowleven, the African focused oil and gas company traded on AIM, announces that it has entered into a farm-out agreement with Vitol E&P Limited (VEP) in respect of the Etinde Permit (Etinde), Cameroon.

The transaction comprises (1) the acquisition by VEP of an initial 25 percent interest in Etinde, in return for funding a $100 million gross work programme; and (2) an option to acquire a further 25 percent interest, in return for funding an additional $100 million gross
work programme and paying $25 million in cash to the Bowleven group to progress Etinde activities.

This funding coupled with the proceeds from the recent placing provides Bowleven with increased financing flexibility to pursue the various exploration and development opportunities identified in its portfolio.

VEP is part of the Vitol Group, a major independent energy trading company, headquartered in Geneva, with a breadth of experience in the oil and gas industry. This includes development, marketing and project finance expertise. Bowleven consider that this expertise should be of real benefit to the resulting joint venture as it moves from exploration to development in Cameroon.

The Etinde Permit area comprises three shallow water blocks (MLHP-5, MLHP-6 and MLHP-7) in offshore Cameroon, West Africa. The Etinde PSC was signed on 22 December 2008 and includes a three year exploration period from the date of signing. Both exploration and appraisal activity has been undertaken by Bowleven on the acreage. The Bowleven group has drilled four wells on Etinde since 2007, all of which have been successful. Bowleven’s current estimated Contingent Discovered Resources (Mean Volumes Initially In Place) for the Etinde Permit are 225 MMbbls of oil, 129 MMbbls of NGLs and approximately 1 tcf of gas. Pending development activity, there is currently no production on the acreage.

On 1 June 2009 Bowleven announced the results of an independent assessment completed by TRACS International Consultancy Limited (TRACS) of the contingent resources of the IF oil discovery in Block MLHP-7 on Etinde. A copy of the TRACS CPR is available on the Company’s website.

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