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.

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.

MF

Recommended

The MoneyWeek Podcast: picking stocks is fun, but you need to do your homework
Investment strategy

The MoneyWeek Podcast: picking stocks is fun, but you need to do your homework

John Stepek talks to Steve Clapham, investor, analyst and author of The Smart Money Method, about the dangers in picking individual stocks and why you…
8 Apr 2021
BP looks set to return more money to shareholders as it beats expectations
Energy stocks

BP looks set to return more money to shareholders as it beats expectations

Oil major BP is to embark on a share buyback programme after significantly reducing its debts. Saloni Sardana looks at what it means for your portfoli…
6 Apr 2021
Deliveroo has hit the market – but it’s not getting the warmest welcome
UK stockmarkets

Deliveroo has hit the market – but it’s not getting the warmest welcome

Food delivery company Deliveroo made its debut on the stockmarket this morning. But with the share price sliding by 30% straight away, it’s not made t…
31 Mar 2021
Three stocks to buy now that will come back stronger after Covid-19
Share tips

Three stocks to buy now that will come back stronger after Covid-19

Professional investor Ed Wielechowski of Odyssean Capital, chooses three compelling stocks that should thrive in a post-pandemic world.
29 Mar 2021

Most Popular

The bitcoin bubble will burst: here’s how to play it
Bitcoin

The bitcoin bubble will burst: here’s how to play it

The cryptocurrency’s price has soared far beyond its fundamentals, says Matthew Partridge. Here, he looks at how to short bitcoin.
12 Apr 2021
What does the Coinbase listing mean for bitcoin and other cryptocurrencies?
Bitcoin

What does the Coinbase listing mean for bitcoin and other cryptocurrencies?

As the bitcoin price hit new highs, the world's biggest cryptocurrency exchange, Coinbase, listed on the stockmarket. John Stepek looks at what that m…
15 Apr 2021
Properties for sale for around £400,000
Houses for sale

Properties for sale for around £400,000

From a converted church in Banffshire with views towards the Cairngorms National Park, to a period property in the Georgian market town of Beverley, e…
2 Apr 2021