Australian-based oil and gas company Otto Energy announces the award of the Santa Rosa Licence, onshore Argentina for a six-year exploration period.
Highlights:
• The Santa Rosa Licence contains a 220km2 shallow dome structure that will be the initial exploration target.
• Otto will earn an initial 32.48% interest in the licence by spending US$1.4m on drilling 2 onshore wells; and has an option to increase to 41.24% for a further US$900,000 in exploration expenditure.
• Joint venture partners Otto Energy and Oromin Explorations Ltd will establish a detailed work program over the coming weeks with a view to drilling as soon as practical.
“We are extremely pleased to confirm the Santa Rosa Licence has now been awarded. This Licence is located in an established, prolific hydrocarbon basin and provides considerable upside for Otto's shareholders should we make a discovery," Otto CEO Alex Parks said.
"We look forward to working closely with our joint venture partner to quickly finalise an exploration plan with a view to start drilling in Argentina within the next 12 months.”
The Santa Rosa Block is a large 7,694 square kilometre onshore concession located in the oil prolific Cuyana Basin of the Mendoza Province of Argentina.
The farm-in consideration is for Otto to fund the first US$1.4 million of a 2-well drilling program. Upon farm-in, the interest holders in the Santa Rosa Licence will be Oromin 67.52% (Operator) and Otto 32.48%. Otto is also entitled to acquire an additional interest of 8.76% in the Licence from Oromin to increase its interest to 41.24% by incurring further expenditure of US$897,381.