Heritage Oil Plc has agreed with Kina Petroleum Limited (Kina Petroleum) to farm-in to two licences onshore Papua New Guinea (PNG).
◾ Two licences, Petroleum Prospecting Licence No:337 ("PPL 337") and Petroleum Prospecting Licence No:437 (PPL 437) have gross areas of approximately 5,508 and 1,530 square kilometres respectively
◾ Heritage will earn a 70% working interest in PPL 337 and be appointed operator
◾ Heritage will initially earn a 30% working interest in PPL 437, with an option to acquire a further 20% interest and operatorship
◾ PPL 337 is an exploration licence with identified drillable prospects
◾ PPL 437 is located in a proven hydrocarbon system east of the Stanley Field and directly north of the Elevala and Ketu Fields and the recent Tingu-1 exploration discovery well
◾ The work programmes on both licences will progress rapidly with wells slated for 2014 on PPL 337
Heritage has agreed to acquire interests in two exploration blocks, PPL 337 and PPL 437, from Kina Petroleum. In return for earning a 70% working interest and operatorship in PPL 337, Heritage will fund the costs of drilling two shallow exploration wells. In addition, Heritage will make a $500,000 contribution to Kina Petroleum's back costs on the licence. In the event of a discovery, Heritage will carry Kina Petroleum's costs of up to 100 kilometres of appraisal seismic data.