Rockhopper Exploration, Harbour Energy, and Navitas Petroleum have extended the provisions of their previously signed heads of terms concerning the Sea Lion project offshore the North Falkland Basin. The new deadline is March 31, 2022: the aim is to sign definitive documentation on the transaction by this date. Harbour plans to exit operations offshore the Falklands, leaving the other two partners to take the development forward.
Rockhopper made the official announcement on Tuesday, saying that ”Rockhopper, Harbour Energy plc (“Harbour”) and Navitas Petroleum LP (“Navitas”) have extended the provisions of the previously signed heads of terms (announced on 8 December 2021) from 31 January 2022 to 31 March 2022, with a view to signing definitive documentation on the transaction by this date.
Under the draft agreement, “Harbour will divest its license interests in the Falkland Islands, and Rockhopper and Navitas will seek to align working interests across all their Falkland Islands petroleum licenses – Rockhopper 35%, Navitas 65%, subject to necessary consents,” Rockhopper said in an earlier regulatory filing.
Rockhopper last year said it remained optimistic on the Falkland Islands‘ Sea Lion project after Harbour announced it would offload its operated interest.
In a December regulatory filing, Rockhopper said the company and Navitas would “jointly develop and agree a technical and financing plan to enable the development of the project to achieve first oil on a lower cost and expedited basis.”
Navitas is Israeli and Harbour is British.
Rockhopper has been operating offshore at the Falkland Islands since 2014. In March the company said the Falkland Islands government had agreed to extend each of Rockhopper’s North Falkland basin petroleum licenses, including the Sea Lion discovery area, until November 2022, with no additional license commitments.
Last month Rockhooper's CEO Sam Moody visited the Falklands to talk with the local government, allegedly for the now officially announced next steps. In a long interview with the local weekly Penguin News, Moody admitted that “it’s the financing that’s the key log jam with Sea Lion; and so I’ve come down to meet with the Government to try and see how we can help to facilitate that transaction going ahead.”
On the progress of these meetings Mr Moody said they have been “very productive.”
And in terms of the future, assuming we can get this deal over the line - obviously I’m making no guarantees we can ever make this project work - but I think Navitas give us as good as a chance as anybody ever has of being able to actually get there.”
CEO Moody praised Navitas Petroleum, “who have a really good, proven, track record in, I would say, unlocking projects that other people have found very difficult to finance,” and mentioned examples of that effectiveness.