New World Oil and Gas has signed two Farm-Out Agreements (‘FOA’) to acquire working interest in Licences 1/09 and 2/09 (‘the Licences’, or ‘the Project’), totaling 4,107 sq km, located in the productive Jutland on-shore area in South Western Denmark (‘the Danica Jutland Project’ or ‘the Project’).

New World will be named Operator of the Project by means of addendums to the existing Joint Operating Agreements (‘JOAs’). The Company has already commissioned a Competent Persons Report (‘CPR’) on the concessions, the results of which were positive, and were previously announced by the Company on 16 August 2011.

The first phase of a planned seismic acquisition programme on the Licences is due to commence in the second quarter of 2012, at an aggregate cost of US$1.25 million which will deliver an initial 12.5% working interest. The Company has the option, as set out below, to increase its working interest to 25% by the investment in further seismic data, and to 80% by funding the completion of one exploration well on each Licence.

The FOAs were agreed between the Company’s wholly-owned subsidiary New World Jutland ApS (‘NW Jutland’) and Danica Jutland ApS (‘DJ’), the joint-holder of the Licences (dated 17 May, 2009). DJ currently has an 80% working interest in the Licences with a single partner, Danish North Sea Fund, which holds a fully-paying working interest in the remaining 20% of the Licences. The FOA is subject to regulatory approval, expected within the next two weeks.

Tags: New World O&G