LONDON (Alliance News) - Range Resources Ltd said Tuesday both it and joint venture operator Africa Energy Corp plan to withdraw from production sharing agreements related to the Nugaal and Dharoor blocks in Somalia.
Range said the principle reason for their withdrawal from the blocks is the uncertainty of the current political climate in Somalia, especially in relation to a disagreement between the federal government of Somalia and the regional government of Puntland, Somalia, over the legitimacy of production-sharing agreements in respect to the blocks and potential territorial claims to the Nugaal block.
The company said that whilst it was disappointed with this outcome, it "acknowledges the political uncertainties that have existed within the country, the state and the region over the recent years", which has prevented the joint venture from conducting the activities required under the production sharing agreements.
However, as Range is focused on its core assets in Trinidad, the Puntland asset has no value attributed to it on Range's balance sheet, it said.
In regards to its Trinidad operations, Range also said Tuesday that its strategic partner and oilfield services provider LandOcean Energy Services Co Ltd has said a drilling rig has been shipped from China and is expected to arrive in Trinidad in August. This rig will be used to drill deeper targets on its licences that it has not been able to access so far.
Three other drilling rigs are now expected to be shipped during July, and all four rigs are expected to be available for drilling from September.
Shares in Range are trading up 1.0% at 0.707 pence Tuesday morning.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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