LONDON (Alliance News) - Tower Resources PLC Thursday said Premier Oil PLC has exercised its right to exit the joint venture in Kenya which has resulted in the company more than doubling its stake in Block 2B at no extra cost.
Lion Petroleum Inc is the operator of Block 2B in Kenya and a subsidiary of Taipan Resources Inc. Lion was informed by Premier that it would exit the joint venture, which has been in effect since April 30. As a result, Lion and Tower's interest in Block 2B has been adjusted to 66.66% and 33.33% respectively.
Prior to Premier opting out of the joint venture, Tower only held a 15% stake whilst Premier held a 55% interest with Taipan holding the balance.
Those stakes will remain for at least the next six months after the Kenyan Ministry of Energy agreed to extend the current exploration period on Block 2B until November 30, 2015. This is in order to complete the assessment of the remaining prospectivity of Block-2B and due to the temporary injunction issued in November 2014 which prevented any work being completed on the site.
"This will give the joint venture partners time to complete their remaining technical assessments and review their strategy with respect to Block-2B. During this extension period no additional financial commitments will be incurred," said Tower in a statement.
Tower shares were down 1.4% to 0.217 pence per share whilst Premier shares rose 2.8% to 160.13 after it made a further discovery offshore the Falkland Islands at the Isobel deep exploration well.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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Tower Resources (TRP)