New World Oil and Gas to increase stake in Belize project

New World Oil and Gas has entered into an agreement with Blue Creek Exploration to amend the terms of a farm-out deal to increase its working interest in the Blue Creek project in northwest Belize.

The agreement was signed in June last year and will give New World Oil and Gas a higher working interest in the 420km² project in the Peten Basin in return for additional seismic work.

New World Oil and Gas currently holds a 12.5% working interest in the Blue Creek project, which it operates, with an option to raise its stake to 100% on completion of a staged work in programme.

The company has completed phase one and two of a planned three-phase 2D seismic acquisition programme, with a total of 139.15 line kilometres acquired to date at a cost of $2.125m.

"We are delighted with the amendment to the FOA, as it delivers New World an additional 10% working interest in the Blue Creek PSA in return for additional seismic work that will be applied towards further high-grading our prospects," said New World Oil and Gas CEO William Kelleher.

"As a result, before we elect whether to proceed to the drilling phase, we will have earned a 35% interest in the highly prospective Blue Creek Project."

Kelleher added: "We are also highly encouraged by the decision of our seismic contractor to accept New World shares in payment for the major portion of the extra 61 line kilometres of 2D seismic."

Once the seismic acquisition programme has been completed, the company will have acquired a 35% working interest in Blue Creek, and as planned earlier, it will acquire a further 12.5% stake upon acquisition of an additional 125km line of 2D seismic data over the project.

The Blue Creek project is estimated to hold gross P50 volumetrics of 294 million barrels of oil, with a combined expected monetary value of $1.51bn.