Renaissance Oil reports on Lukoil venture in Amatitlán
Energía a Debate (with information from Renaissance Oil Corp.)
Renaissance Oil Corp. announced today that it has closed the previously announced acquisition of the 25% interest in its integrated exploration and production contract for the Amatitlán block in Veracruz, Mexico. Following this transaction, the balance of ownership in the Amatitlán contract is 50% indirectly held by Lukoil and 25% by Marak Capital.
“Renaissance’s and LUKOIL’s operational objectives are to re-establish production in the shallower Chicontepec formation and to commercialize the potentially prolific Upper Jurassic shale formations,” stated Craig Steinke, Chief Executive Officer of Renaissance. “Renaissance is pleased to take the role of lead operator, providing the opportunity to apply our proven unconventional resource development expertise in combination with the extensive global expertise of Lukoil.”
As consideration for the acquisition, Renaissance said it has issued a promissory note for US$1,750,000 to Marak, with a payment due date of April 1, 2017. Renaissance entered into separate options agreements to acquire a further 12.5% interest in the Amatitlán contract from Marak and 25% from Lukoil. Upon exercise of all options, Renaissance will hold a participating interest of 62.5% in the Amatitlán contract. The options are exercisable during a 60-day exclusivity period, commencing upon the migration of the Amatitlán contract to a contract of exploration and extraction, expected between late 2017 and the first quarter of 2018.
Renaissance and Lukoil have agreed to an accelerated 2017 development plan for Amatitlán. The program is expected to include workovers of existing wells, drilling of six new wells in the shallower Chicontepec formation and drilling a well targeting the deeper upper Jurassic shale formations. Renaissance believes the upper Jurassic shales have the potential to be a premier shale play, on an international level. Renaissance will take the lead role in operations for Amatitlán and is responsible for 25% of the related capital expenditures, pro-rata to its stake in the project.
The Comisión Nacional de Hidrocarburos (CNH) recently informed Renaissance that the review of development plans for the Mundo Nuevo, Malva and Topén blocks (the "Chiapas Blocks"), in Chiapas, Mexico, is expected to be finalized by approximately the end of March 2017 which, upon approval, will begin the 12 month appraisal period for the work programs for each block. Reneissance expects to execute the work programs for the Chiapas Blocks between the third quarter of 2017 and early 2018.
Renaissance also announced the appointment of Mr. Carlos Escribano to the company as Chief Financial Officer (“CFO”). Mr. Escribano previously served as CFO for publicly traded multi-national corporations in Mexico and other Latin American countries. Mr. Escribano is a chartered professional accountant and graduate of the University of British Columbia. It also announced the appointment of Mr. Wade Spark as Operations Manager for Northern Mexico. Mr. Spark will coordinate the development of the Amatitlán block and has over 30 years experience in the oil and gas industry, with previous senior positions at international oil companies, including Petroamerica Oil Corp., Petrominerales Colombia Ltd., Nexen (Can Oxy) Petroleum Colombia Ltd. and Norcen Energy Resources Limited.