Tower Resources has established farm-out agreements with Prime Global Energies for interests in the Thali license offshore Cameroon and PEL96 offshore Namibia. These arrangements involve a total cash contribution of $4.4 million, enabling significant drilling operations in 2025. Completion of the agreements is expected by early 2025, subject to government approvals, enhancing Tower’s prospects for growth in its asset base.
Tower Resources, the U.K.-based oil and gas enterprise, has formalized two significant farm-out agreements with Prime Global Energies, acquiring minority, non-operated stakes in both the Thali license located offshore Cameroon and the PEL96 license situated offshore Namibia. Under these agreements, Tower Resources Cameroon will transfer a 42.5% non-operated interest in the Thali license to Prime in exchange for a $15 million cash injection towards the Thali work program, particularly for the drilling of the NJOM-3 well scheduled for 2025. The project’s timing hinges upon government approval for the farm-out transaction and an extension to the First Exploration Period due to end on February 4, 2025.
Additionally, Prime Global Energies will obtain a 25% non-operated interest in PEL96, offshore Namibia. In turn, Tower Resources will receive substantial payments, including an immediate cash injection of $937,500 and a further $3.4 million upon completion of the farm-out agreements, culminating in a total cash endowment of $4.4 million. The anticipated completion of both agreements is expected by the conclusion of the first quarter in 2025, pending necessary government and regulatory consents.
CEO Jeremy Asher indicated that this funding will facilitate the drilling of the NJOM-3 commitment well, marking a pivotal milestone for the company. He expressed satisfaction over the acknowledgment of PEL96’s potential in these negotiations and the flexibility exhibited by all parties involved. Asher underscored their ongoing aim to realize progress across the entire asset portfolio, with these transactions expected to enhance operational liquidity, thus allowing for more decisive movement on all work programs.
Tower Resources operates in the oil and gas sector primarily focusing on exploration and production in Africa. The Thali license in Cameroon and the PEL96 license in Namibia represent significant assets within their portfolio. The farm-out agreements with Prime Global Energies are strategic moves aimed at financing operational projects and expanding their interests in these promising licenses. These partnerships may lead to increased exploration activities which can significantly enhance the company’s valuation and operational capabilities. Government approvals and partnerships are critical elements in navigating the complexities inherent in the oil and gas industry, affecting timelines and operational strategies.
In conclusion, Tower Resources’ farm-out agreements with Prime Global Energies present a strategic advancement for the company, particularly in funding the NJOM-3 well and enhancing interests in the PEL96 license. With anticipated cash inflow and operational flexibility, Tower Resources appears poised to execute its work programs with heightened confidence, driving value for stakeholders and potentially expanding its footprint in the competitive oil and gas market.
Original Source: www.oedigital.com
