The Company refers its shareholders to previous communication relating to its contractual interests in relation to the Oil Prospecting Licence 281 ("OPL 281"), which is located onshore the Federal Republic of Nigeria.
On 06 October 2010 SacOil through its wholly-owned subsidiary SacOil 281 Nigeria Limited (SacOil 281) concluded a farm-in agreement with EER 281 Nigeria Limited (EER 281) and Transnational Corporation of Nigeria PLC (Transcorp). In terms of the farm-in agreement, SacOil 281 will acquire from, and be assigned a 20% interest in the OPL 281 concession by Transcorp.
The assignment to SacOil 281 of the participating interest in OPL 281 requires the prior approval from the Government of Nigeria. A pre-requisite to seeking such approval has been for Transcorp to have entered into a production sharing contract ("PSC") for OPL 281 with the Nigerian National Petroleum Corporation (NNPC).