Business
Settlement Agreement
Settlement Agreement.
About this update from Tower Resources Plc
[{"type":"text","content":"\n \nRNS Number : 8120O Tower Resources PLC 25 September 2013 \n \n\n25 September 2013\n \nTower Resources plc\nSettlement Agreement\nTower Resources plc (the \"Company\" or \"Tower\" (TRP.L, TRP LN)), the AIM listed Africa focussed oil and gas exploration company, is pleased to announce the signing of a Settlement Agreement (\"Agreement\") between Tower, Wilton Petroleum Limited (\"Wilton\"), Ophir Energy plc (\"Ophir\") and its wholly owned subsidiary Ophir Madagascar Limited (\"Ophir Madagascar\") relating to the Marovoay Block-2102, onshore Madagascar.\nOn 3 July 2013, Tower announced the conditional acquisition of Wilton for an initial combination of US$1.75 million cash and 120 million Tower shares locked-in for 12 months, which at yesterday's closing price valued Wilton at US$4.2 million; this was scheduled for completion by 31 August 2013. Wilton's sole asset is a 20% interest in Block-2102, onshore Madagascar, carried for one firm exploration well by Ophir Madagascar (80% interest, Operator) capped at a net value of US$4.0 million under a Farmout Agreement dated 8 July 2010 (as amended). \nThe first exploration well was scheduled to be drilled by 19 April 2014, as per Amendment No.6 to the Production Sharing Contract (\"PSC\") signed by OMNIS, Ophir Madagascar and Wilton on 11 April 2013.\nOn 2 September 2013, Tower announced that Ophir Madagascar had verbally indicated to Wilton that they did not wish to proceed with the commitment well. This resulted in Tower extending the completion date of the Wilton transaction to 30 September 2013 in order to accommodate negotiations between the parties. \nOn 23 September 2013, Ophir announced that it had notified OMNIS (Office des Mines Nationales et des Industries Stratégiques) in Madagascar of its intention to relinquish the interest in and operatorship of Block-2102 in order to concentrate on its core, material assets.\nIn order to compensate Wilton, inter alia, for the loss of its carry in the well of up to US$4.0 million and its interest in Block-2102, a Settlement Agreement has been executed by the parties dated 24 September 2013, under the terms of which Wilton will receive US$6.0 million in cash from Ophir by no later than 26 September 2013. Tower plans to then proceed to complete the acquisition of Wilton: the 120 million consider...