Africa Energy to add interest in Block 11B/12B, offshore South Africa

Africa Energy Corp. has signed definitive agreements to increase its effective interest in Block 11B/12B in Outeniqua basin 175 km off the southern coast of South Africa to 10% from 4.9%.

“In anticipation of the Luiperd-1X well results expected later this year, we have agreed with Impact and Arostyle to simplify and consolidate Main Street's 10% interest in Block 11B/12B under Africa Energy,” said Garrett Soden, president and chief executive officer, Africa Energy (OGJ Online, July 7, 2020).

Africa Energy currently holds 49% of the shares in Main Street 1549 Proprietary Ltd., which has a 10% participating interest in Block 11B/12B. Total E&P South Africa BV is operator and has a 45% participating interest in the block, while Qatar Petroleum International Upstream LLC and CNR International (South Africa) Ltd. hold 25% and 20% participating interests, respectively.

The company is pursuing two transactions by which Africa Energy will first secure the indirect financial interest held by Impact Oil & Gas Ltd. and then obtain an option from Arostyle Investments (RF) (Proprietary) Ltd., which holds 51% of the shares in Main Street, to acquire the entire participating interest after drilling the Luiperd-1X well. Following the Impact transaction and exercise of the Arostyle option, subject to various consents and approvals, Africa Energy will directly hold the participating interest, and both Impact and Arostyle will be significant shareholders of Africa Energy.

The Impact transaction is independent of the Arostyle transaction and is subject to Africa Energy disinterested shareholder approval and TSX Venture Exchange approval. Closing is expected to occur in October. Closing of the Arostyle transaction is dependent on closing the Impact transaction and is subject to TSX Venture Exchange approval.