Pan Orient Energy Corp. has entered into an agreement for the transfer of a 51% direct working interest and operatorship of the East Jabung Production Sharing Contract (PSC) to a wholly owned subsidiary of Talisman Energy for a consideration of:
An upfront cash payment of USD$8 million (CDN$9.2 million),
A firm commitment to fund the first USD$10 million (CDN$ 11.4 million) towards the first exploration well in addition to all related G&A and overhead costs incurred by the operator until the first USD$10 million expenditure has been completed, and
A Pan Orient option to acquire a 20% working interest in a Talisman operated South Sumatra, Joint Study Area.
A contingent commitment to fund the first USD$5 million (CDN $5.7 million) towards an appraisal well, if justified, in addition to all associated G&A and overhead incurred by the operator until the first USD$5 million expenditure has been completed.
The transaction is subject only to Government of Indonesia approval and is anticipated to close upon the receipt of this approval, anticipated approximately March 2015.