Project Profile
Value: US$45 million
Location: Middle Magdalena Basin, northern Colombia
Area: 43,000 acres
Sintana Energy Inc. through Patriot Energy Oil & Gas Inc., wholly-owned by the Company, has entered into a Farmout Agreement with ExxonMobil Exploration Colombia Limited, a wholly owned subsidiary of ExxonMobil Corporation for the exploration and development of unconventional oil and gas resources in the VMM-37 Block. The VMM-37 Block is located in Middle Magdalena Basin, in northern Colombia and covers 43,000 acres of land. Subject to approval by the Agencia Nacional de Hidrocarburos of Colombia (the ANH), ExxonMobil will acquire an undivided 70% participation interest and operatorship in the formations defined as unconventional by completing the Work Program. Patriot will retain the remaining 30% interest in the unconventional play as well as its current 100% participation interest in the conventional resources overlying the top of the unconventional interval.
ExxonMobil will pay 100% of all Exploration Phase I well costs (3 wells). The estimated timing for the commencement of drilling operations on the first exploration well is the third quarter of 2013. A consideration will be paid that will compensate Sintana for its past expenses connected with the block. ExxonMobil will have an option to proceed to the next phase. In this development phase, it will pay 100% of all additional costs to a maximum of US$45 million, of which US$10 million will be recouped by ExxonMobil from 50% of Patriot\'s production proceeds.
Operators:
ExxonMobil Exploration Colombia Limited: Operator with 70% interest
Patriot Energy Oil & Gas Inc. (subsidiary of Sintana Energy Inc.): 30% interest
Contractors:
Petrotech: Calculated a P50 best estimate