Repsol and privately held Armstrong have reached an agreement to strategically re-align their interests in their Alaska North Slope exploration and development venture. The confidential agreement includes a combination of cash, operational control, drilling commitments and contractual adjustments for monetary considerations in excess of $800 million.
Per the restructured agreement, Armstrong has acquired a 15% working interest (to add to its 30%) in the initial development area near the Colville River Delta where the majority of exploratory and appraisal drilling activities have been carried out. In addition, Armstrong has the option of acquiring an additional 6% and assuming operatorship in the development area. Armstrong also acquired a 45% working interest (to add to its 30%) and operatorship in the jointly-owned exploratory lands (750,000+ acres). It is anticipated that Armstrong, after exercising its 6% option, will own 51% and Repsol 49% in the development area, and Armstrong 75% and Repsol 25% in the exploration area. As part of this agreement, the previously planned 2015-16 winter appraisal drilling campaign has been deferred.