Melbana Energy has provided an operational update regarding Block 9 Production Sharing Contract (PSC) onshore Cuba, in which it holds a 30% interest via a wholly owned subsidiary that is also the operator.
Highlights
- New seismic data and Amistad-2 well results improve understanding of the oilfield, thereby further derisking future production wells.
- Amistad-1 reopened and producing oil unassisted to surface from a clearly recharged reservoir, validating decision to redrill a new production well there.
- Sonangol failed to cure its defaults. Melbana to resume 100% ownership of the PSC, subject to regulatory approval. Options for the recovery of the US$23.5 million owed by Sonangol under review.
Melbana Energy’s Executive Chairman, Andrew Purcell, commented: 'The data obtained from the last well and our seismic acquisition program have meaningfully contributed to our reservoir models. We will use a three-dimensional version of the seismic to further derisk our future production wells, given we’ve shown it can provide such important data quickly and economically. We’re keen to drill the next well, but are maintaining minimal site supervision and production operations until we once again own 100% of Block 9. The significant oilfield we have discovered onshore in Cuba is well positioned to benefit from the heightened global interest in energy security once regional political issues are resolved.'
Contractual Developments
Melbana’s wholly owned subsidiary issued default notices to Sonangol earlier this year following its repeated failure to meet cash calls totalling US$23.5 million under approved work programs in Block 9, Cuba. As Sonangol did not remedy these defaults within the prescribed timeframe, the Company instructed its lawyers to notify Sonangol that it is deemed to have withdrawn from Block 9 and that its 70% participating interest is to be assigned to the Company. Melbana is now working with the relevant Cuban regulator to effect this transfer which, once completed, would result in Melbana once again holding 100% of Block 9 PSC. The US$23.5 million remains an obligation of Sonangol despite it having withdrawn from Block 9 and the Company is considering its options for the recovery of these monies.
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Source: Melbana Energy
