Clontarf Energy concludes agreement on its Peruvian exploration blocks

AIM-listed mining company Clontarf Energy has concluded an agreement on its Peruvian oil and gas exploration blocks, an update issued from the company on Wednesday has shown.

AIM-listed mining company Clontarf Energy has concluded an agreement on its Peruvian oil and gas exploration blocks, an update issued from the company on Wednesday has shown.

The company reported that Peru Oil and Gas Exploration(POGEL), an energy investment company, would undertake responsibility to put up performance bonds and conduct contractual work on the exploration and development contracts on Peruvian Blocks 183 and 188.

Advertisement - Article continues below

It said that POGEL would also assume the agreed Peruvian liabilities of Hydrocarbon Exploration, a wholly-owned subsidiary of Clontarf Energy.

POGEL is a strategic investor in Peru and intends to develop thermal power generation, producing electricity from natural gas, Clontarf added.

Under the agreement, Clontarf Energy will convert its interest to an overriding royalty of 3.0% on production from any commercial discovery. The company said that royalty payments would be capped at $5.0m per structure, $10m per block and $20m in total.

David Horgan, of Clontarf Energy, said: "We are delighted to have attracted a strategic investor that recognises the opportunity presented by Peru's large and fast growing gas market. During our work in nearby communities we have experienced power cuts and know that thermal gas-fired power stations offer the best solution to Peru's growing demand for energy.

"POGEL is committed to making quick progress on proving up resources and bringing gas reserves into production. This will benefit all stakeholders, including the local communities, the Peruvian Exchequer, and Clontarf Energy shareholders."

Clontarf Energy's share price was up 6.67% to 2.0p at 11:29 on Wednesday.




Investment strategy

Broker safety – your questions answered

Cris Sholto Heaton answers more of your questions about the safety of stockbroker accounts
25 Mar 2020
Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020

Why investors should be “cautiously bullish” for 2020

Analysts have been out in force making rosy predictions for stockmarkets in 2020, but while there is certainly a case for optimism, investors should r…
17 Jan 2020

Most Popular


These seven charts show exactly why you must own gold today

Covid-19 is accelerating many trends that were already in existence. The rising gold price is one such trend. These seven charts, says Dominic Frisby,…
3 Jun 2020

Disease, rioting and mass unemployment – so why are markets soaring?

Despite some pretty strong headwinds in the last year, America’s S&P 500 stock index is close to all-time highs. John Stepek explains why markets seem…
4 Jun 2020
EU Economy

Why a stronger euro is good news for investors

The fragile state of the eurozone has for a long time brought the threat of deflation. But the ECB’s latest moves have dampened those fears. John Step…
5 Jun 2020